US Home Sales Numbers Troubling For US Economy
$DIA, $SPY, $QQQ, $VXX
US home resales fell sharply in February in a potentially troubling sign for America’s economy which has otherwise looked resilient to the global economic slowdown.
The National Association of Realtors (NAR) said Monday existing home sales dropped 7.1% to an annual rate of 5.08-M units, the lowest level since November.
Sales have been volatile and prone to big swings up and down in recent months following the introduction in October of new mortgage regulations, which are intended to help home buyers understand their loan options and shop around for loans best suited to their financial circumstances.
February’s decline weighed on investor sentiment, with the S&P 500 stock index falling after the data was released.
Sales fell across the country, including a 17.1% plunge in the US Northeast.
Economists had forecast home resales decreasing 2.8% to a pace of 5.32-M units last month. Sales were up 2.2% from a year ago.
The median price for a previously owned home increased 4.4% from a year ago to $210,800.
The housing report runs counter to data showing strong job growth and a stabilization of factory output, which had taken a hit from weaker demand overseas and a strong USD.
Housing continues to be supported by a tightening labor market, which is starting to push up wage growth, boosting household formation. But a relative dearth of properties available for sale remains a challenge.
“Finding the right property at an affordable price is burdening many potential buyers,” said NAR economist Lawrence Yun.
In February, the number of unsold homes on the market rose 3.3% from January to 1.88-M units, but was down 1.1% from a year ago.
At February’s home sales pace, it would take 4.4 months to clear the stock of houses on the market, up from 4.0 months in January. A 6-month supply is viewed as a healthy balance between supply and demand.
Monday, US major stock market indexes finished at: DJIA +21.57 at 17623.87, NAS Comp +13.23 at 4808.86, S&P 500 +2.02 at 2051.58
Volume: Trade was light with about 800-M/shares exchanged on the NYSE.
| HeffX-LTN Analysis DIA: | Overall | Short | Intermediate | Long |
| Bullish (0.27) | Neutral (0.21) | Bullish (0.46) | Neutral (0.14) |
| HeffX-LTN Analysis SPY: | Overall | Short | Intermediate | Long |
| Bullish (0.28) | Bullish (0.35) | Bullish (0.25) | Neutral (0.22) |
| HeffX-LTN Analysis QQQ: | Overall | Short | Intermediate | Long |
| Bullish (0.39) | Very Bullish (0.58) | Neutral (0.21) | Bullish (0.39) |
| HeffX-LTN Analysis VXX: | Overall | Short | Intermediate | Long |
| Neutral (-0.22) | Very Bearish (-0.51) | Neutral (-0.10) | Neutral (-0.06) |
Stay tuned…
Paul Ebeling
HeffX-LTN
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