We’re still a long way from the bottom in the housing market, but we are at least finally seeing signs of a turn. Today’s encouraging news comes from New Home Sales, which appear to be bottoming.
To be clear: This does not mean that we’re going to see a rebound. Just that sales of New Homes won’t likely fall all the way to zero. Inventories of new homes are returning to normal, but inventories of existing homes are still high, so prices should continue to fall.
Although sales were at a March record low, there are positives in this report – especially considering the upward revisions for previous months. It appears the months-of-supply has peak, and there is a reasonable chance that new home sales has bottomed for this cycle – however any recovery in sales will be modest because of the huge overhang of existing homes for sale.
Summary charts from Calculated Risk below. See Calculated Risk for complete analysis >
New homes sales finally bottoming…at the lowest level ever.
Inventories returning to normal.
Inventory-months also continues to fall from its all-time high…