Surging New Home Sales Not What They Seem

Delayed due to the government shutdown, new home sales data for September and October was released together this year. The results, from the U.S. Census Bureau and the Department of Housing and Urban Development, show a 25.4 percent sales spike in October from September’s rate. The surge is the largest in more than 30 years but isn’t all it seems to be. In fact, the report includes a downward revision of August’s estimate that dropped that month’s sales estimate by 15 percent. From there, new home sales fell an additional 6.6 percent in September. That means, October’s skyrocketing sales were merely making up for a slow end of the summer sales season. Peter Boockvar, chief market analyst of economic advisory firm The Lindsey Group, told NBC News that weak sales activity from July through September was clearly based on mortgage rates. According to Boockvar, falling rates in October brought out buyers who may have previously been on the fence. More here and here.

Comments are closed.