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Old Posted May 24, 2007, 4:11 PM
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Home sales soar by record level

http://news.yahoo.com/s/ap/20070524/..._ec_fi/economy

Home sales soar by record level


The sign stands outside a new home that sits unsold in an east Denver neighborhood on Tuesday, May 22, 2007. Sales of new homes surged in April by the biggest amount in 14 years, but the median price of a new home dropped by the largest amount on record. The mixed signals left no clear picture of whether the worst of the nation's housing slump is over.(AP Photo/David Zalubowski)

By MARTIN CRUTSINGER, AP Economics Writer
44 minutes ago



WASHINGTON - Sales of new homes surged in April by the biggest amount in 14 years, but the median price of a new home dropped by the largest amount on record. The mixed signals left no clear picture of whether the worst of the nation's housing slump is over.

The Commerce Department reported that sales of new single-family homes jumped by 16.2 percent in April to a seasonally adjusted annual rate of 981,000 units. That was far better than the tiny 0.2 percent gain that economists had been expecting.

However, the median price of a new home sold last month fell to $229,100, a record 11.1 percent decline from the previous month. The big price decline indicated that builders are slashing prices in an effort to move a huge overhang of unsold homes.

The jump in sales was the biggest increase since a 16.4 percent surge in new home sales that occurred in April 1993.

However, analysts cautioned against reading too much into the big gain, especially in light of other surveys showing that builder confidence has sunk in recent months over worries that troubles in the subprime mortgage market will further crimp demand in coming months.

The strength in sales was led by a 27.8 percent surge in the South. Sales were also up in the West by 8.5 percent and in the Northeast, where they rose 3.8 percent.

Sales fell in the Midwest, dropping by 4 percent.

The drop in median prices in April compared to March was a record one-month decline. If the April sales price was compared to the sales price a year ago, the decline was 10.9 percent, the biggest year-over-year drop since 1970.

In other economic news, the Commerce Department said that orders to U.S. factories for big-ticket manufactured goods posted a moderate 0.6 percent increase in April, helped by a continued rebound in business investment.

In a third report, the Labor Department said that the number of newly laid off workers filing applications for unemployment benefits rose to 311,000 last week, an increase of 15,000. But even with the gain, claims remain at a level indicating a healthy labor market.

While the increase in orders for durable goods was less than had been expected, the government sharply revised the March performance to show a 5 percent surge, much stronger than the 3.7 percent gain previously reported.

Analysts believe that U.S. factories, which have been buffeted by the weakness in housing and slumping demand for autos, are starting to stage a moderate rebound, helped by reviving interest on the part of businesses to spend money to expand and modernize.

The overall economy slowed in the first three months of this year to an annual growth rate of just 1.3 percent, the weakest performance in four years, as a steep slump in housing continued to weigh on the economy's performance.

Analysts are hoping that spending by consumers and businesses will be able to overcome the weakness in housing and keep the country out of a recession.

The report on durable goods offered encouragement in the area of business investment. It showed that demand for capital goods excluding airplanes, considered a good proxy for business investment, rose by 1.2 percent in April following, the second solid monthly increase.

The 0.6 percent rise in total durable goods orders came even though demand for transportation products fell by 1.3 percent. This reflected a drop of 10.7 percent in demand for commercial aircraft and a 1.9 percent fall in orders for motor vehicles.

Excluding transportation, orders would have been up by 1.5 percent, the same performance as in March.

There was strength in orders for primary metals such as steel which rose by 4.3 percent and orders for electronic equipment and appliances, which rose by 3.8 percent.

But demand was weak for computers, which fell by 7.8 percent, and communications equipment, which dropped 5 percent.
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Old Posted May 25, 2007, 4:54 PM
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Home prices fall for 9th straight month

http://news.yahoo.com/s/ap/20070525/..._ec_fi/economy

Home prices fall for 9th straight month

By MARTIN CRUTSINGER, AP Economics Writer
27 minutes ago



WASHINGTON - Sales of existing homes fell by a larger-than-expected amount in April while the median price of a home sold during the month fell for a ninth straight month as the troubles in the subprime mortgage market acted as a further drag on housing.

The National Association of Realtors reported Friday that sales of existing homes fell by 2.6 percent last month to a seasonally adjusted annual rate of 5.99 million units. That was the slowest sales pace since June 2003.

The median price of a home fell to $220,900, an 0.8 percent fall from the midpoint selling price a year ago. It marked the ninth straight decline in the median price.

Sales were weak in all parts of the country. The Northeast experienced the biggest decline, a fall of 8.8 percent in April from the March sales pace. Sales were down 1.7 percent in the West, 1.2 percent in the South and 0.7 percent in the Midwest.

The drop in existing home sales for April followed news that sales of new homes surged by 16.2 percent last month, the biggest one-month rise in 14 years. However, that big jump was accompanied by a record drop in median new home prices. Analysts saw that as a sign that builders are getting more aggressive in slashing prices as a way to move a glut of unsold new homes.

The drop in sales was accompanied by a big jump in the number of unsold homes left on the market. They climbed to a record total of 4.2 million. It would take 8.4 months to exhaust that supply of homes at the April sales pace.

Analysts are concerned that the glut of unsold homes will further depress prices in coming months.

But Lawrence Yun, senior economist for the Realtors, said that the small year-over-year price decline of less than 1 percent was still modest compared to the 50 percent rise in home prices that occurred during the five boom years that ended last year.

Yun said some of the weakness in April reflected a weather payback after sales had shown gains at the beginning of the year, reflecting warmer-than-normal winter weather.

He also blamed the rising troubles in the subprime mortgage market, the area of the market designed for borrowers with weaker credit histories. Rising mortgage foreclosures are causing banks and other lenders to tighten up on their lending standards while curtailing their more risky loan business.

"We've been anticipating slower home sales because many subprime loan products are no longer available," he said. "Fortunately, a wide availability of conventional mortgage products and the 4.5 million jobs created over the past 24 months will help stabilize the market going forward."

He said the big rise in unsold homes on the market could be an indication that sellers are testing the market in hopes of selling their homes and moving up to larger units, which he said would be a positive early sign of a rebound in housing.

But other analysts are not as optimistic, expressing concerns that housing could remain under downward pressure for the rest of this year and stage only a modest recovery in 2008.

The troubles in housing have acted to depress overall economic activity which slowed to a growth rate of just 1.3 percent in the first three months of this year, the slowest economic growth rate in four years.
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Old Posted Mar 19, 2008, 7:18 AM
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I saw this thread and almost fell out of my chair. Either this is real old news or lies are flying like fruit flies. Sales are at there worse since the 1930's.
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Old Posted Mar 21, 2008, 5:48 PM
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You sure about that?


This is a little Off-Topic, but for anybody who thought that this would be the worst downturn since the Great Depression, put this into perspective: back then 25% of the workforce was unemployed...................right now it's less than 10%.


Anyways, I think a 40% Socal Home Price drop is a bunch of BS. Thats around an average drop of $200,000 less!
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Old Posted Mar 21, 2008, 5:52 PM
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You do realize this thread was first posted back in May of 2007.
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Old Posted Mar 21, 2008, 5:55 PM
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Technically, I wasn't the one who bumped it, so it doesn't matter, right?
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Old Posted Mar 22, 2008, 5:13 PM
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I was talking to Renton... he said "Either this is real old news or lies are flying like fruit flies" and I was pointing out that, indeed, it is really old news.
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Old Posted Mar 25, 2008, 4:18 PM
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Yeah, good point, this thread should be to keep up with current events.
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