New Home Sales Hold Close to Fastest Pace Since 2023

Bloomberg

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00:00We're looking at new home sales crossing the terminal right now, and we have Michael McKee here with us,

00:07our international economics and policy correspondent, to break the data.

00:11So we're looking at a couple pieces of data, Mike.

00:15One of them looks fairly in line with expectations and the other one wildly different.

00:20Well, the problem is this is another one of those distorted economic data points because of the government shutdown.

00:26This is both September and October new home sales.

00:31The October number comes in at 737,000.

00:35You can see there's no prior number because there is no prior report for that yet.

00:41New home sales on a month-over-month basis, on a percentage basis, were down a tenth of a percent.

00:46The expectation was they'd be down 10.6%, so a little bit better performance.

00:52But, of course, the new home sales market is still an issue for the overall economy.

00:58The seasonally adjusted change in the number of new houses for sale at the end of October 2055 was 488,000.

01:07That's just about the same number as in September, but we didn't have a number for September until today.

01:14So there's not adding a significant number of houses out there, although there's still a 7.9-month inventory out there,

01:23essentially unchanged from September.

01:27But it's below the October estimate.

01:30So still not building enough houses.

01:33Median sales price, $392,300, 3.3% below September.

01:39So maybe that played a role a little bit in getting a few more houses sold.

01:45But the new home industry still is a laggard out there for the overall economy.

01:50We've had a lot of data.

01:51And, Mike, I was just thinking when you were talking about, you know, do we have the past month to compare it to nonfarm payroll, CPI, new home sales,

01:58everything that we've gotten from official government data.

02:00Has the fog lifted?

02:02Is this enough for central bankers to have a more clear idea of what they're going to do this month and months to come this year?

02:08Well, if you leave your house and it's 7 a.m. and everything's foggy and you can't see it, maybe we're at 8 a.m. now and it's starting to lift a little bit.

02:15It's not completely there.

02:17We're going to have distortions in the data for quite a while.

02:19We're going to have distortions in the CPI until April because of the way it's constructed and the numbers that are missing fall out.

02:26But we're going to see slowly, gradually improving data because, of course, we now have the September-October numbers.

02:36When we do get the November numbers and December numbers for new home sales, they will give us more of a comparison, put it that way.

02:44But they're still running behind on collating and distributing all this stuff.

02:48We'll see you next time.

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