New home sales up 11% in June, the highest in 9 years.

[Papa Deuce]

Even though you or I may not think so, this is usually a great indicator of the economy moving forward.

What do you think?

Actually, I do think we are starting the rebound. I've been saying that for about 6 weeks.

EDIT: Here is PART of an article I found on Fox News:

WASHINGTON -- New home sales in June posted the fastest increase in more than eight years as buyers took advantage of bargain prices, low interest rates and a federal tax credit for first-time homeowners.

While home prices are still falling, the figures released Monday were another sign the housing market is finally bouncing back. Earlier this month, the government reported that new home construction rose to the highest level since last fall. And data out last week showed home resales rose almost 4 percent in June, the third straight monthly increase.

"The worst of the housing recession ... is now behind us," said David Resler, chief economist at Nomura Securities. "We're turning the corner toward increased activity in housing."

New home sales rose 11 percent in June to a seasonally adjusted annual rate of 384,000, from an upwardly revised May rate of 346,000, the Commerce Department reported Monday.

Shares of big homebuilders soared on the news, with Beazer Homes USA up by more than 13 percent and Hovnanian Enterprises rising 8 percent in afternoon trading. But with home prices still falling, these companies won't be making much money anytime soon.

The median sales price of $206,200 was down 12 percent from $234,300 a year earlier and off nearly 6 percent from $219,000 in May.

In addition to lower prices, buyers are rushing to tax advantage of a federal tax credit that covers 10 percent of the home price or up to $8,000 for first-time buyers. Home sales need to be completed by the end of November for buyers to take advantage.

 

[The Mystery Machine]

I don't know PD. What areas are showing an increase?

My DH had Black Monday today as they announced they are laying off 10%.

Here in St. Louis MO we are pretty torn up.

 

[lil mermaid]

Hell, I don't know. All I can say is that five homes went up for sale in my neighborhood in the last ten days, and every single one of them is due to a job loss or some other financial problem.

 

[mamacatnv]

I live in one of the highest foreclosure areas in the country - not sure what I think of that headline. Housing continues to decline in value and our unemployment rate continues to climb.

 

[Papa Deuce]

I don't know PD. What areas are showing an increase?

My DH had Black Monday today as they announced they are laying off 10%.

Here in St. Louis MO we are pretty torn up.

National news today, so I am guessing nationally. It was just on ABC news, but I couldn't hear it. I just saw the graphics.

 

[omghidanielle]

I don't know how much I believe this, but I hope its true!

 

[sorul82?]

By "new home" does this mean completed homes? How would a bankrupt builder selling, oh say, 10 finished and 5 almost finished to another builder factor into these numbers? Technically the houses were sold in June, but they are back on the market.

 

[AristocatFan]

I don't see it. We're still waiting for our house to sell!

 

[Free4Life11]

11% sounds nice. But how does the VOLUME of homes sold this month compare with 1, 3, or 5 years ago?

I need some context to go with that statistic.

And the real question is, how did the buyers of these homes finance their purchases? Traditional home loans? Let's all pray these people READ their mortgage and understand exactly what their payments will be!

 

[DisneyBlonde]

Good garsh I hope so PD. I need a job!!

 

[Papa Deuce]

Good garsh I hope so PD. I need a job!!

Well, then, I truly hope you get one!

 

[sorul82?]

By "new home" does this mean completed homes? How would a bankrupt builder selling, oh say, 10 finished and 5 almost finished to another builder factor into these numbers? Technically the houses were sold in June, but they are back on the market.

Just bumping to see if anyone knows the answer to my question.

 

[Sanchez]

Just bumping to see if anyone knows the answer to my question.

New construction as opposed to resales (which increased 4% - http://timesnews.net/article.php?id=9015550) This takes into account distressed builder sales and is not evidence of an improving housing market. Many cash investors are speculating on these homes. It seems logical that faced with comparable prices buyers will choose new over a resale. It is possible that this is another "bubble." The key in the article above is that values are decreasing and that overall home sales are still down 21% from last year.

http://www.census.gov/const/newressales.pdf
http://consumerist.com/5323815/new-home-sales-increase-still-down-21

In my opinion the problem is that the average buyer cannot obtain credit. Anyone who has attempted to refinance or purchase in the last 8 months would agree that getting a mortgage is very difficult. In addition, many have to sell a home before they can buy another so inventory remains high. Job losses mount and home values continue to deteriorate.

 

[shortbun]

We're looking for a another house and the realtors we've talked to are hurting here in Columbus, Ohio. Sales are flat, dead, according to them. What was it Lincoln said about believing none of what you hear and only half of what you see?

But wait, an 11% increase over a negative number(as in forclosures rather than sales) still isn't so great but....we'll take it!!

 

[dairyou]

I hope it true too! I wonder if sometimes this good news helps people to feel more hopeful. That maybe we are out of this recession which helps promote spending.

Deb

 

[The Mystery Machine]

New construction as opposed to resales (which increased 4% - http://timesnews.net/article.php?id=9015550) This takes into account distressed builder sales and is not evidence of an improving housing market. Many cash investors are speculating on these homes. It seems logical that faced with comparable prices buyers will choose new over a resale. It is possible that this is another "bubble." The key in the article above is that values are decreasing and that overall home sales are still down 21% from last year.

I was watching Warren Buffet's recent taping on CNBC and he mentioned the "speculation" or the numbers game on Wall Street. It is what is driving our economy.

My DH works for a huge corporation, seen everywhere all the time , and they are laying off 10%.

Why? Not because they are not making a profit, it is because they have a forecasted number to bring to the table. So in order to make that number good on paper they fire people.

It is all "funny money".

 

[DisneyBlonde]

It is all "funny money".

Not so funny when our entire economic structure tanks and people lose their homes.

And the big execs at companies like your husband's retire multi-millionaires due to those firings. I know, I have worked for two of those companies. I don't know how they sleep at night knowing they have fleeced America. I know that I wouldn't be able to.

 

[barkley]

i think using "new home" sales to speculate or decide that the housing market is stabelizing or any where near back on the upswing is insane.

new homes vs existing homes is a whole different ball game. there are tens of thousands of existing homes that can never be sold to cover the "cost" to their owners. the homes in my old neighborhood are currently sellable only at what they could be purchased for 9 years ago. that means that only those who purchased 9 or more years ago can recoup exactly what the home cost then (not all the upgrades they've put into it, no appreciation in value). with sales commissions and associated real estate fees they still end up losing money. people who bought less than 9 years ago, if they can sell (i only know of one person who paid cash outright in the development so the other owners have mortgages/home equity loans they would have to ensure could be paid in full to complete a sale) they will be looking at as much as a $500,000 loss (i kid you not-houses sold originaly for all the same price, top end model was $200,000, right before the bubble burst those models were selling for as much as $650,000 so when you add in the sales commissions and real estate fees it's WAY up there on the losing end).

so you've got tens of thousands of homes that realisticly can't be sold for financial reasons, add into those the ones that are foreclosed and decaying that won't be sold (and further drive down values), add into those the homes that many newly laid off or soon to be laid off workers will lose to foreclosure and you've got a glut that's going to sit.

i think the housing market has also lost for the foreseeable future a traditional factor in sales-the "buying up" purchasers. you know, the folks like dh and me who grew up and were taught buy a house, build some equity, sell that house to get into a better house until you've bought up to the home of your dreams. the equity is'nt building in homes, it's being lost so while a homeowner sees their next step up home priced at a bargain price, unless they've actualy got equity in their home AND can sell it to access that equity it does'nt matter what that next step up costs, they can't buy it.

this economic situation is going to have ramifications for YEARS. it's not something that will "go back to normal"-"normal" is gone, "normal" has changed. buisness and industry that relied on retiree spending will see decreasing numbers of retirees (delayed due to lost investments or retirement funds), buisness and industry that relied on young college educated grads, making good money and having "expendible income" will see many fewer (i know too many people who never fathomed their kids would have to pay any part of their college educations, now their college investings for those kids is gone PLUS tuition is going up 15% a year so their kids, if they can get into college- because massive reductions in the numbers of freshmans being allowed to enroll is happening in allot of states are going to be saddled with tens of thousands in student debt and then may find there are no jobs available in any field)....those buisnesses and industries see reduced income, results in cut backs and more job losses/fewer job opportunities-it's going to long haul.

 

[Papa Deuce]

I just saw today that 4 homes have gone up on my mom's street, which is just 2 streets away from me. They apparently went up in the last 2 weeks. Two of them are already sold.

I don't know the prices, but I imagine $225% - $250K.

 

[missypie]

I just read an email by a real estate broker, bragging about the huge recent increase in condo sales in a popular resort area. Fine...but the email also said that the median sales price declined from $699,000 to $432,000.

Good news: You can find a purchaser for your condo.
Bad news: You can sell it for $267,000 less than you thought. (And what if your note balance is more than $432,000?)