New home purchases increased 24 percent from May to an annual pace of 330,000

Sales of U.S. New Houses Climb to 330,000, More Than Economists' Forecasts
By Courtney Schlisserman - Jul 26, 2010


Sales of U.S. new homes rose in June more than forecast following an unprecedented collapse the prior month, a signal the worst of the slump triggered by the end of a government tax credit is over.

Purchases increased 24 percent from May to an annual pace of 330,000, figures from the Commerce Department showed today in Washington. The rate was the second-lowest in data going back to 1963 after May’s downwardly revised 267,000 pace.

The lowest mortgage rates on record may help underpin demand, stabilizing the industry that triggered the worst recession since the 1930s. Even so, increasing foreclosures are swelling the number of unsold existing homes, putting pressure on prices and keeping buyers on the sidelines as unemployment hovers near 10 percent and the economy cools.

“We’ll probably reach an equilibrium level over the next couple of months and I wouldn’t be surprised if we slog along the bottom,” Stephen Stanley, chief economist at Pierpont Securities LLC in Stamford, Connecticut, said before the report. “Until we get a more definitive turn in growth, in particular employment, housing demand is going to remain very soft.”

Economists forecast sales would rise 3.3 percent to an annual pace of 310,000, according to the median of 73 projections in a Bloomberg News survey. Estimates ranged from 260,000 to 360,000. The government had initially estimated May sales were 300,000.

more...

http://www.bloomberg.com/news/2010-07-26/sales-of-u-s-new-houses-climb-to-330-000-more-than-economists-forecasts.html

It's working!

We'll get those housing and debt bubbles reinflated so that we can all go back to spending and consuming like there is no tomorrow.

Long live the 1990s!

So the 90's under President Clinton where we had strong economic growth, job growth and surplusses were bad?

""Right now we're running about 60 percent below the average annualized rate for the last decade, so there's a lot of potential out there for improvement," said Michael O'Rourke, chief market strategist at BTIG LLC in New York."

So, not only is your post unnecessarily nasty, but it's way off base.

Recommended.

This part of the article bothers me.....

"Another challenge to new home sales is the rising tide of foreclosures. Home seizures jumped 38 percent in the second quarter from a year earlier, RealtyTrac Inc. said last week, putting lenders on pace to claim more than 1 million properties this year."

Foreclosures are still going up. Doesn't matter how many homes are purchased if they are in turn foreclosed on months down the line. Existing home sales here are very poor......not that people are not trying....a beautiful home down the road from me took 4 "SOLD" signs before financing finally went through for one of the potential buyers.

Haven't checked in a couple of months, but the foreclosure numbers include a couple of quite different groups of properties: owner-occupied primary residences, "investment" properties and second homes, builder/developer speculative construction. The worst hit states have problems in each of these groups (FL, CA, NV, TX), fueled initially by speculative overbuilding often using other-people's-money (from pension or retirement funds, etc.). So a thousand-unit Florida condo complex is foreclosed on by their lenders.

The housing market in places like NC which have decent consumer-protection laws has been slow and prices have pulled back from the peak, but relatively few houses are being foreclosed on, and the market is slowly returning to more-normal behavior, houses are selling, and prices have quit falling and are starting to creep back up.

are taking advantage of the low prices for housing. Properties that were once abandoned in my neighborhood are being bought at a very fast pace. A woman purchased a three bedroom house across the street from us for twenty five hundred dollars. So an escalation in home buying is something I have already noticed. Not to mention a lot of people have down sized out of the big homes with those crazy mortgages and walked away or did short sales,and paid cash for their primary residence in different area so they could maintain a reasonable standard of living.With this recession came some true reality checks for a lot of people.

At least here in Northern California there are a lot of people who have stopped paying their mortgages, since the value of the mortgage is more than the house is worth. Banks are not willing to revise the terms, and at the same time hesitant about starting foreclosure proceedings since it would further depress the real estate prices

The real estate market WILL NOT improve significantly until people are put back to work.

:shrug:

We had a serious recession but no where near a depression. Currently, as a whole, we are in a recovery.. albeit slow and regional.

"The supply of homes at the current sales rate fell to 7.6 months’ worth from 9.6 months in May. There were 210,000 new houses on the market at the end of June, the fewest since 1968."