As with this morning’s Case Shiller index of existing home prices, New Home sales continued to show early signs of a turn. New home sales increased 2.4% in July, to a 515,000 annual pace from from a revised 503,000 in June. This represents a 35% decline year-over-year–slightly higher than June’s 33% (bad) but still less than April’s peak at -41% (good). Inventory levels, moreover, fell from a revised 10.7 months of supply to 10.1 months of supply (also good).
By “early signs of a turn,” we do not mean that house prices are about to stop falling. Just that the rate of decline is about to peak. This is the earliest sign of a change and should help homeowners, Wall Street, and the homebuilders get a better picture of where and when the bottom will be.
Consumer confidence, meanwhile, comfortably exceeded expectations in August, coming in at 56.9 versus the 53 mean estimate as consumers respond to falling gas prices. This marks an increase from 51.9 the previous month.
Graph courtesy Briefing.com.
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