by Bill McBride on three/14/2019 03:34:00 PM

Initial, this report was for January the February report will be released on March 29th.

New property sales for January had been reported at 607,00 on a seasonally adjusted annual price basis (SAAR). This was under the consensus forecast, on the other hand the 3 preceding months had been revised up.

With these revisions, sales enhanced two.three% in 2018 compared to 2017.   I anticipate sales to be about the very same level in 2019 as in 2018 (not fall off a cliff), and my guess is we have not observed the peak of this cycle but.

On Inventory: Months of inventory is now above the best of the typical variety, on the other hand the quantity of units completed and below building is nevertheless somewhat low.   Inventory will be anything to watch really closely.

Earlier: New House Sales decreased to 607,00 Annual Price in January.

Click on graph for bigger image.

This graph shows new property sales for 2018 and 2019 by month (Seasonally Adjusted Annual Price).

Sales in January had been down two.four% year-more than-year compared to January 2018.

The comparison will be most tricky in Q1.

And right here is one more update to the “distressing gap” graph that I 1st began posting a quantity of years ago to show the emerging gap triggered by distressed sales.  Now I am hunting for the gap to close more than the subsequent numerous years.

Distressing GapThe “distressing gap” graph shows current property sales (left axis) and new property sales (correct axis) via January 2019. This graph begins in 1994, but the partnership had been pretty steady back to the ’60s.

Following the housing bubble and bust, the “distressing gap” appeared largely for the reason that of distressed sales.   The gap has persisted even although distressed sales are down considerably, considering the fact that new property builders have focused on a lot more high-priced properties.

I nevertheless anticipate this gap to gradually close.   Even so, this assumes that the builders will supply some smaller sized, much less high-priced properties. If not, then the gap will persist.

Even so, this assumes that the builders will supply some smaller sized, much less high-priced properties. If not, then the gap will persist.

xisting property sales are counted when transactions are closed, and new property sales are counted when contracts are signed. So the timing of sales is diverse.