Are Fears About the Housing Market Overblown? - Real Time Insight

By
A A A

May new home sales blew out the forecast as they soared 16.9% year-over-year to 504,000. It was the highest monthly sales rate since May 2008.

Sales also jumped 18.6% from April which saw just 425,000 sales.

A "sale" for new home purposes simply means that a contract has been signed. It doesn't mean that those homes have actually closed.

Inventory decreased to 4.5 months from 5.3 months in April.


Median home price jumped to $282,000 from $275,800 in April. The builders appear to be targeting the more expensive price point right now.

New home sales can be volatile month to month. If you look at year-to-date data, new home sales are up just 1% so far in 2014.

Existing home sales are actually down 7% year-to-date.

New home sales are important to the economy because they create jobs not only in construction but in electrical work, plumbing, landscaping, flooring, and interior decorating.

In the last FOMC press conference, Chairman Yellen talked about worries the Fed had about the housing recovery as sales appeared to be slowing.

Does this latest data ease some of those fears?


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

ISHARS-US HO CO (ITB): ETF Research Reports

To read this article on Zacks.com click here.

Zacks Investment Research



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Stocks

Referenced Stocks: ITB

Zacks.com

Zacks.com

More from Zacks.com:

Related Videos

Stocks

Referenced

100%

Most Active by Volume

100,376,898
  • $17.62 ▲ 0.51%
83,231,837
  • $25.62 ▲ 1.91%
75,739,329
  • $111.78 ▼ 0.77%
65,297,937
  • $36.37 ▼ 1.76%
59,053,093
  • $47.66 ▲ 0.29%
53,482,350
  • $2.59 ▼ 0.38%
51,504,284
  • $7.34 ▲ 2.37%
51,434,656
  • $8.14 ▲ 6.96%
As of 12/19/2014, 04:15 PM


Find a Credit Card

Select a credit card product by:
Select an offer:
Search
Data Provided by BankRate.com