Yahoo news reports Sales of new homes up 4.9 percent in April.
While that makes a nice sounding title, the rest of the article is slightly incomplete. The links for Yahoo news usually disappear so I’m not posting the link to the article. Instead here’s a summary of the interesting parts. You’ll see its slightly less optimistic.
The Commerce Department reported Wednesday that sales of new single-family homes increased by 4.9 percent last month to a seasonally adjusted annual rate of 1.198 million units, the highest rate since last December.
Economists, who had been forecasting a sales decline in April, said the increase had been skewed by the fact that the government lowered sales activity significantly in prior months.
Also, they noted that the number of unsold homes remaining on the market at the end of April rose to the highest level on record, an overhang that they predicted would depress prices going forward.
The median price of a new home sold in April was $238,500, up just 0.9 percent from a year ago, far below the double-digit price gains sellers were enjoying last year at the peak of the housing boom.
“Housing is holding up better than we had thought given how much mortgage rates have gone up, but we still expect it to weaken as the year goes forward,” said David Wyss, chief economist at Standard & Poor’s in New York.
Wyss said he expected home sales would drop by 10 percent this year and that construction of new homes and apartments would be down by about 8 percent.