Surprisingly Big Bounce for Existing Home Sales
March 23, 2006 — Sales of existing homes rebounded during February, in a surprise to economists after months of soft data had suggested that the housing sector was beginning to cool. The National Association of Realtors said Thursday that sales of existing single-family homes and condominiums increased 5.2% to a seasonally adjusted annual rate of…
March 23, 2006 — Sales of existing homes rebounded during February, in a surprise to economists after months of soft data had suggested that the housing sector was beginning to cool. The National Association of Realtors said Thursday that sales of existing single-family homes and condominiums increased 5.2% to a seasonally adjusted annual rate of 6.91 million units from January’s revised 6.57 million annual pace, halting a five-month string of declines in home resales. January resales were originally reported at 6.56 million. Single-family home sales rose 4.7%, while sales of condominiums and co-ops jumped 8.8%. Stephen Stanley, chief economist at RBS Greenwich Capital, called the data “a very surprising result” in light of previous declines and a growing consensus that “the housing sector is softening rapidly.” David Lereah, chief economist for the Realtors, said that “higher interest rates had been tapping the breaks, notably in higher-cost housing markets, but we’re seeing signs of stabilization in the market now with the sales rebound.” The Realtors have been forecasting home resales would fall by about 5% this year compared with last year’s record pace, but Mr. Lereah said he may have to revise that forecast given the unexpected strength in February.
Existing Home Sales Rise [Wall Street Journal]
Sales of existing homes may have risen but sales of new homes fell 10.5% in February, the number of homes on the market hit a record high and the median home price declined.
http://news.yahoo.com/s/nm/20060324/bs_nm/economy_dc
Note this part of the article: “Friday’s report on new home sales followed data on Thursday showing surprising strength in the pace of home resales. But the data measure different things, and reflect distinct timing in homebuyers’ purchase decisions.”
Let be beat this dead horse just a little deader:
The reason we’re on brownstoner.com and not on condoer.com is that there is inherent value in houses (esp. brownstones) in a city as dense as NY.
The market can go up, down, all around — it don’t matter. You buy a house in NY, be it in Greenpoint, Fort Greene, or Greenwich Village, you’ll ALWAYS be okay.
Reread this comment a few months from now as I say that the “big bounce” is just a spike. Just as we’ve had downward spikes on the way up (see chart again), we’ll have upward ones on the way down – too short an interval for news-worthiness. The sources of these types of charts never ceases to amaze me.
Not sure if you caught this:
Standard and Poor’s to Launch
New Real-Estate Product
http://www.realestatejournal.com/buysell/markettrends/20060324-talley.html
My only concern is that it most likely will not include coop sale prices because those are recorded differently from houses and condos.
I don’t think the sky is falling either, Pete, but to someone who bought something in 2004 and later, should the value of their home drop even a little and they need to sell, let me tell you, they’ll certainly be quite upset.
I don’t think anyone is predicting left and right foreclosures, especially for people who can afford their homes and plan to stay in them.
Besides, who cares about the 80s? There are plenty of things now that could cause a downturn – rising interest rates, extremely easy credit tightening (no more home ATMs), lack of real income growth – these things alone could return us to 2003 levels, which, as I said earlier could potentially hurt a lot of people. And frankly, I don’t buy that our economy is in great shape – the US owes more money than ever, we have a seemingly ongoing war, low income growth and most of the new jobs are in real estate – doesn’t seem all that healthy to me.
The sky is falling, the sky is falling.
Is it not even a possibility that sales in future could fall to a ‘healthy’ level – one that is not booming as in past few years – and not in a free fall where little sells and people are having homes foreclosed left and right?
Anything that does not match frentic pace of sales of past couple years or increases in price will now be called soft market or bursting bubble.
I think will take a real shock to market to crash it. Folks keep pointing to downturn in prices of late 80’s without analyzing what were the factors at that time that brought market down a couple notches other than previous run-up in prices.
Good point B’stoner, I think, but that will only help to make the market softer. Soon, buyers will catch on that more inventory means they can stop offering asking or over and make the sellers come off their clouds a little.
Or everyone’s wants to cash in before it gets soft…
I live in Greenpoint, and I have for 15 years. There are “For Sale” signs on houses all over the neighborhood, which is unprecedented since I have been here, so at least in Greenpoint, it seems like the housing market is quite soft