For all the chatter about how much better the U.S. economy is doing, someone forgot to tell the residential real estate market. Not only did housing starts get crunched 11.7% MoM in October, but we also just saw existing home sales slip unexpectedly by 2.2% MoM to 4.43 million units — not to mention down 26% from last year’s incentive-induced level. The inventory backlog remains intractable at 10.5 months’ supply — a balanced market is closer to 6 months’ supply. Median resale prices slipped 0.6% in October and have fallen now for four months in a row, during which the slide has come to a 19% annual rate. Deflation, as it pertains to residential real estate, clearly remains a present-day reality. [Rosenberg]
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