Tag Archives: new home sales

The Predictions Were Wrong Again

Posted on by

The doom and gloom crowd is just not happy with the Trump economy. It isn’t really the Trump economy yet–he has only been in office four months, but he has definitely made some moves that have impacted the economy.

On Friday, Breitbart reported:

The economy keeps failing to live up to claims by critics of the Trump administration that the economy is teetering on a recession.

Sales of new single-family homes surged in April, with the pace of sales rising to a seasonally adjusted annual rate of 743,000 units, the U.S. Census Bureau and Department of Housing and Urban Development reported Friday. That’s a 10.9 percent increase from March and 3.3 percent above the level from a year earlier, though both comparisons fall within margins of error that leave statistical significance uncertain.

The South and Midwest regions led the gains, with sales up 11.7 percent and 35.5 percent, respectively, from March. The Northeast, by contrast, saw a sharp 14.8 percent monthly decline in sales.

The April numbers mark the fastest sales pace since early 2023 and suggest some resilience in the new home market, even as mortgage rates remain elevated and affordability continues to be a headwind.

We are getting to the end of the baby boomer retirement years. The youngest baby boomer is now about 61 years old. How much of the increased new home sales in the South and the Midwest is the result of the boomers retiring and moving to places where the weather is better and the cost of living lower?

The article concludes:

The data show continued strength in mid-range price tiers, with homes priced between $300,000 and $499,999 accounting for just over half of April’s sales. Homes under $300,000 made up only about 15 percent of the market.

Upward Revisions and Regional Divergence

With this release, the Census Bureau revised seasonally adjusted figures going back to January 2020, a move that slightly adjusted trends in past months. Regionally, the year-over-year picture remains mixed: the Midwest and South posted modest gains from April 2024, while the Northeast and West saw declines.

The new home market continues to reflect a bifurcated economy, with demand supported by new household formation and limited resale inventory, but constrained by affordability challenges and financing costs.

As energy costs come down, and people have a bit of wiggle room in their budgets, I suspect we will see the housing market do very well in the areas of the country with a reasonable cost of living.

Good Economic News

Posted on by

On Wednesday, Breitbart posted an article reporting some economic news that looks good for the direction of the American economy.

The article reports:

Orders for durable goods rose far above expectations in February, climbing 0.9 percent to $289.3 billion, according to the Commerce Department’s report released Wednesday.

Economists had forecast a 1.0 percent decline, but instead, businesses continued to invest heavily in big-ticket items, particularly automobiles, computers, and machinery.

Even excluding transportation, which can be volatile due to large aircraft orders, new orders increased by 0.7 percent, exceeding the forecast of a 0.3 percent gain. The strength of the overall durable goods orders report is further demonstrated by robust gains in key categories.

Auto orders were notably strong, with orders for motor vehicles and parts rising 4.0 percent. Shipments of motor vehicles and parts also surged by 3.9 percent, indicating strong demand from consumers and businesses alike.

The decline of 0.3 percent in core capital goods orders—non-defense capital goods excluding aircraft—appears to be a pullback following the strong 0.9 percent gain in January. This decline also undermines claims that businesses are rushing to buy equipment ahead of potential tariffs. Even with February’s decline, core capital goods orders are still up by 7.3 percent year-to-date, indicating that business investment remains robust.

The article concludes:

The durable goods report is the latest piece of so-called “hard data” that indicate actual economic activity continues to expand despite “soft data”—such as consumer and business surveys—indicating anxiety over policy uncertainty and tariffs. Earlier this week, the Commerce Department reported new home sales rose solidly and inventories of new houses for sale increased. Last week, the Federal Reserve said industrial output climbed 0.7 percent in February, including a 0.9 percent rise in manufacturing output.

We have a businessman in the White House–not a professional politician. It makes a difference.