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Homebuilders cheer big new home sales number

  • Brutal winter weather has been the excuse for a long string of weak economic stats this year, but not January New Home Sales, which surged 9.6% from December to a seasonally adjusted annualized pace of 468K - a 5-year high. Expectations were for a drop to 400K. December sales were revised higher from 414K to 427K.
  • The median sales price rose 3.4% Y/Y to $260,100.
  • The Northeast led the way with a 73.7 jump. Sales climbed 11% in the West, and 10.4% in the South. In the MidWest, they dropped 17.2%.
  • Full report
  • The homebuilders cheer. ETFs: XHB +1.9%, ITB +2.2%. Individual names: TOL +1.8%, HOV +2%, RYL +2.9%, KBH +2.5%, LEN +2.7%, PHM +2.3%.
Comments (10)
  • starcorral
    , contributor
    Comments (335) | Send Message
     
    When I invested in HOV the new housing market was in the dumps. The impressive thing about HOV was their land buying spree. I mean - undeveloped land taxes were in the dumper, and Hovnanians experience recognized that as foreclosed property was absorbed, the new housing market would come back. It sure made sense to me. For HOV to double or triple within 12 - 24 months would not surprise me. The winning strategy is somewhat of a crap shoot - just like a guy buying on margin because a stock is generating nothing but good numbers but languishing because ofirresponsible guidance (does Ford ring a bell?).

     

    So I now rate HOV not as a "buy" but as a "DON'T BE A FOOL - BUY AS MUCH AS YOU CAN AFFORD". Good news a few months after the ground recovers from a brutal winter will fuel speculators; quarterly reports will drive stocks skyward. Again - I may be naive, but when I am stalled on the tracks and see a train coming in the distance, I can quickly add 2 and 2 together and project how long I have to move my car and lay a couple of coins on the track.
    26 Feb, 10:55 AM Reply Like
  • Gedankonomist
    , contributor
    Comments (620) | Send Message
     
    "Homebuilders cheer big new home sales number"

     

    Huh? Another link just below this one says "Mortgage apps sink to 2-decade low." How is that possible--what are they, buying these McMansions with cash? (Yea, right)
    26 Feb, 12:20 PM Reply Like
  • AnAvgJoe
    , contributor
    Comments (266) | Send Message
     
    I just read that post, then saw this article's tagline, and I was thinking the same exact thing. How do we reconcile these two seemingly opposed metrics?
    26 Feb, 12:32 PM Reply Like
  • SA Editor Stephen Alpher
    , contributor
    Comments (540) | Send Message
     
    The slide in mortgage applications in mostly about refinancing. Purchase app index is flattish.
    26 Feb, 12:36 PM Reply Like
  • King Rat
    , contributor
    Comments (571) | Send Message
     
    One possibility is "mortgage apps" is an absolute number whereas "home sales" is extrapolated over the year with a weighted average. 3,000 more sales than expected (for a historically slow month) and they measure a beat of 50,000. It could be Chinese buying houses with cash before the Year of the Horse New Year's holiday. If I were Chinese and had lots of cash that is what I would do.
    26 Feb, 01:00 PM Reply Like
  • The_Hammer
    , contributor
    Comments (3810) | Send Message
     
    what a bunch of shysters--- the entire re complex food chain.
    26 Feb, 03:47 PM Reply Like
  • 50 cent it is
    , contributor
    Comments (1300) | Send Message
     
    Don't worry Hammer
    If the lenders get in trouble again,the taxpayers will bail them out again and give them a nice bonus
    Jack Welsh got GE into the lending business and the stock went down to $6 yet his is considered a legendary leader of our time and a visionary.
    Actually he destroyed billions in value
    That's the kind of person business looks up to
    26 Feb, 06:52 PM Reply Like
  • GMGlobal
    , contributor
    Comment (1) | Send Message
     
    they are using bitcoins to buy the houses
    26 Feb, 09:32 PM Reply Like
  • dawamacomb
    , contributor
    Comment (1) | Send Message
     
    Wow, Home Depot goes up big yesterday a day before the housing news today. somebody's got some inside info.
    27 Feb, 01:33 AM Reply Like
  • 50 cent it is
    , contributor
    Comments (1300) | Send Message
     
    Dawamacomb
    So what else is new!
    27 Feb, 08:22 PM Reply Like
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