[mEDITate-OR:
find what is new, is getting really, REALLY old for U.S.
In the first CR article Jim points out to U.S. that new home median prices are down.
and in the 2nd chart that half of all sales are under US$ 200K.
Half of all home sales were under $200K in April - tying Jan 2009 as the highest level since 2003 (there was panic selling in Jan 2009).
What that shows U.S. is that most of the new buyers, using the 2nd Buyers Tax Credit, are younger couples that cannot afford too expensive a home.
That is VERY good news - bcuz it means that precisely the new family home buyers we wanted to help ARE taking U.S. up on the offer.
In the Second CR article it shows U.S. that new home sales were also driven up, by families that preferred to buy a NEW home.
The 3rd & 4th charts show U.S. that the "inventory" of new home dropped like a rock, as did the months supply.
What builders KNOW is that new home sales will also drop back for most of the rest of this year.
In the Third CR article is shows U.S. that new apps for mortgage loans DID drop back off - drastically - to a 13 year low !!
the lowest Purchase Index observed in the survey since April 1997.
The Fourth CR article shows U.S. that apps for REFIs went up a lot.
Obviously, if there is anyone left who can, and should, do a REFI is now trying to do it.
They know to, what you should, expect - interest rates might start to go back up.
You should read CR's Jim's analysis about REFIs - he is dead on point.
The FED program to buy FMae&FMac mortgages is over.
Other than the current stock market and Fed budget deficit fears driving TBill yields down...
there is no reason, currently, why interest rates might not rise back to "normal levels".
However, note that the FED has not, and will not, increase the re-discount rate until RE and the jobs economy fully recover.
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Remember LARGE charts are available at CR's web site.
Click on the Heading to get there, click on the chart to see them.
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by CalculatedRisk on
5/26/2010 12:40:00 PMAs part of the new home sales report, the Census Bureau reported that the median price for new homes fell to the lowest level since 2003.
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The second graph shows the percent of new home sales by price.
Half of all home sales were under $200K in April - tying Jan 2009 as the highest level since 2003 (there was panic selling in Jan 2009).
And excluding Jan 2009, this is the highest percentage under $300K since May 2003 - and the highest under 400K since April 2003.
To summarize: the homebuilders sold 16,000 more units in April 2010 than in April 2009 - probably because of the tax credit, and at lower prices - and now sales will decline sharply in May probably close to the 34,000 units sold in May 2009.
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New Home Sales increase to 504K Annual Rate in April
The first graph shows monthly new home sales (NSA - Not Seasonally Adjusted).
Note the Red columns for 2010. In April 2010, 48 thousand new homes were sold (NSA).
The record low for the month of April was 32 thousand in 1982 and 2009; the record high was 116 thousand in 2005.
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The second graph shows New Home Sales vs. recessions for the last 45 years.
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another long term graph - this one for New Home Months of Supply.
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The final graph shows new home inventory.
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MBA: Mortgage Purchase Applications at 13 Year Low
This graph shows the MBA Purchase Index and four week moving average since 1990.
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Mortgage Refinance Activity
This graph shows the weekly MBA refinance activity, and the Ten Year Treasury yield (Note: Using the 10 year to approximate moves in mortgage rates).
Every time the 10 year yield drops sharply, refinance activity picks up. But notice what happened at the end of 1995. The Ten Year yield dropped, but the increase in refinance activity was muted. This was because mortgage rates didn't fall below the rates of a couple years earlier - and many people had already refinanced at those lower rates.
The same thing is happening now, and although activity has increased, there will only be a huge surge in refinance activity if mortgage rates fall below the rates of 2009.
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