New Home Sales Continue to Surge

Mish

New home sales continue their surge in 2020 now exceeding all but the peak bubble years.

New Home Sales As Reported

The Commerce Department reports New Home Sales declined 0.3% in October but that does not factor in a significant upward revision in September. 

Sales of new single-family houses in October 2020 were at a seasonally adjusted annual rate of 999,000, according  to estimates released jointly today by the U.S. Census Bureau and the Department of Housing and Urban Development. 

This is 0.3 percent below the revised September rate of 1,002,000, but is 41.5 percent above the October 2019 estimate of 706,000. 

New Home Sales Seasonally Adjusted Annualized

New Home Sales Seasonally Adjusted 2020-10

Seasonal Adjustments Annualized

Note reported sales of 999,000 for October alone when the actual year-to-date total (January Through October) is 703,000.

Year-to-Date Analysis

From 2007 through 2019, year-to-date total sales for 10 months were less than in 1963.

Think about population growth and let that statistic settle.

Sales then surged in 2020 exceeding all but the bubble years of 2003-2006.

How the Housing Bubble Was Reblown in 20 Cities

Prices are through the roof thanks to Fed stimulus and suppressed interest rates.

For discussion, please see How the Housing Bubble Was Reblown in 20 Cities

Meanwhile, please note that Without a Deal 12 Million Will Soon Lose All Unemployment Benefits.

It's a tale of two recoveries, one for the haves and none for the have nots.

Mish

Comments (22)
No. 1-13
Zardoz
Zardoz

The GOP is trying to punish the country for not complying with its wishes... and it’s landing on the poor.

Six000mileyear
Six000mileyear

Again, this will not end well. I just looked at the long term 10-yr Treasury yield chart. There are 3 fairly clear recent 4-yr yield cycles. The bottoms were in 2008, 2016, and very likely 2020. Yields have nearly doubled off the low in 2020. Those lending in 2020 have taken losses on mark-to-market if held or securitized. Those using adjustable rate mortgages will get blown out of the water when rates reset. In some respects, this bubble is worse because there are fewer qualifying 1st time home buyers due to greater student debt and COVID job losses.

Dodge Demon
Dodge Demon

The Big Sort

njbr
njbr

Meanwhile, apartment building after apartment building are getting built with old REIT money.

And buyers are hesitating on high-rise condos.

And I get ads every day telling me that now is the time to get into these REITs.

Probably someone wants to bail out.

JG1170
JG1170

The one and only thing that a Biden administration COULD (but probably WON'T do) that I would personally appreciate is put serious limits on how many single family homes can be purchased by a faceless corporation. Maybe even limit mom n pops to single digit SFR empires. I imagine the government will do it eventually, but it it will be far too late as there will already be entire generations of renters with no hope of ever "owning" a darn thing.

shamrock
shamrock

The first thing to do if you see a bubble is buy. There's 5 more years coming.

njbr
njbr

kraken...ohhh, kraken--where are you?

Has anyone seen my kraken?

It was supposed to be in Georgia today...

So sad.

Tengen
Tengen

Off topic, but since the community section is closed, check out the title of Sidney Powell's so-called kraken:

IN THE UNITED STATES DISTRICCT COURT, NORTHERN DISTRCOICT OF GEORGIA, ATLANTA DIVISION

I'm not making this up. You'd think she could have had a high school kid proofread this first, but apparently not. See for yourself here:

Bam_Man
Bam_Man

Gresham's Law in action.

footwedge
footwedge

As if we need more proof of the bifurcation of our economy - it is good to be in the top 30%!

Johnson1
Johnson1

That jump in the amount new homes sold almost seems like a statistically anomaly? Specially after much of the summer was shut down. Who was building so many houses unless these are purchases for new houses to be built?

autrader1
autrader1

@Mish was massively bearish on home sales months ago, maybe he is finally coming around

jizazkn
jizazkn

More evidence of the rigged market pricing in the Feral [no] Reserve's FIAT DEBT "QE w/ abandon" - thru their WS white-shoe boys as usual - under cover of the SCAMdemic as the next step to the "Great Reset" when the current covert REAL asset consolidation/transfer/capture is rolled up by the int'l financial elite PBTs?


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