Friday, March 24, 2006

 

New Home Sales for February

Via Bloomberg:

Sales fell 10.5 percent to an annual rate of 1.08 million, the lowest since May 2003, from a revised 1.207 million in January. The number of homes for sale rose to a record 548,000 from January's 525,000.

The expected number was a decline of 2.7% so the market was caught off guard. Normally the interest rate markets do not react very strongly to this number but it was so far off expectations that bond prices rallied a 1/3 of a point. Not a huge amount but more than the usual two or three tick reaction.


Another nail in the coffin of the housing bubble.

There was a strong regional character to these numbers:

Sales fell in two of four regions. They declined 29 percent in the West to 252,000 and fell 6.4 percent in the South to 575,000. Sales rose 12.7 percent in the Northeast to 71,000 and gained 5.2 percent in the Midwest to 182,000

As Bill O told me recently, renting a U-Haul going to California from Colorado costs $200. From California to Colorado is $2000.

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