Census Department new home sales data, chart by Mish
October flashback
Before we get into the joke of a November report, let’s recap what I said last month in New home sales rebound 7.5% from negative reviews
Last month I noticed huge new negative sales revisions for August. This month, the Census Department reports negative revisions for September.
If the trend continues, there will also be negative revisions next month.
November New Home Construction Report
With this introduction, please consider the New Residential Construction Report for November.
November revisions
- August from 661,000 to 646,000
- September from 580,000 to 559,000
- October from 632,000 to 605,000
groundhog day negative
These revisions are in addition to the negative revisions of October and September, which were lowered again.
is this a joke or what? Negative Groundhog Day perhaps?
Your Da!
November Preliminary – 640,000!
It took a while to compile the report today because the St. Louis Fed did not have numbers to upload for November as of 1:00 p.m. or so.
I entered the numbers and revisions manually into my spreadsheet.
November Report Issues
- New Home Sales Sales of new single-family homes in November 2022 were at a seasonally-adjusted annual rate of 640,000, according to estimates released jointly today by the US Census Bureau and the Department of Housing and Urban Development.
- That’s 5.8% (±22.7%)* above the revised October rate of 605,000, but 15.3% (±13.0%) below the November 2021 estimate of 756,000.
- The median selling price for new homes sold in November 2022 was $471,200. The average sale price was $543,600.
- The seasonally adjusted estimate of new homes for sale at the end of November was 461,000. That represents an 8.6 month supply at the current sales rate.
Not that anyone has a reason to believe the numbers, but there you go. Hooray, we reported a 5.8% increase in new home sales in November.
Seasonally adjusted new home sales since 1963
Pleasant bounce
With this 5.8% rebound reported in November 2022, I am pleased to report that sales are approaching the 665,000 figure reached in July 1963.
New house for sale
New home sales provide Census Department data, chart by Mish
Clean slate
This month, the Census Service revised the monthly supply for every month going back a full year.
The other revisions dated back “only” to August. Not that the supply numbers would make sense even if there were no revisions when the chart was next drawn.
New homes for sale by construction stage
Scroll to continue
Census Department New Home Sales by Construction Stage Report, Mapped by Mish
Construction stage details
- Of the 461,000 purported homes for sale, 107,000 haven’t even started, and are unlikely to do so in this environment. Only 64,000 are actually completed.
- To be generous, there are 354,000 homes for sale, at least started, with 290,000 under construction.
Note that this month’s supply includes 107,000 homes that have not even been started.
What about cancellations?
The Census Department does not subtract cancellations from its reports, and cancellations due to rising mortgage rates have been huge.
To repeat, none of these reviews, including cancellation and cancellation rates, reached 25%!
In declining sales environments and (current) economic downturns, the Census Department significantly overestimates sales, even though we ignore revisions.
In times of economic recovery, the census service underestimates sales.
Existing home sales crash
On December 21, I commented Existing home sales drop in 10th month, down another 7.7%
- Existing home sales are down 35.4% from a year ago.
- Existing home sales are down 37% since January.
It’s a transaction crash. And we have never seen such declines other than in recessions. Expect the price to follow, but nowhere near as fast as 2008-2009.
Well, that’s okay, because almost everyone tells me that jobs become gangbusters. Are they?
The Philadelphia Fed just revised down 1.2 million jobs for the second quarter
To discuss, please see The Philadelphia Fed just revised down 1.2 million jobs for the second quarter
The discussion was a hotbed of discussion on Twitter, as was the gap between GDP and GDI which should match.
The BEA has heavily revised lower earnings and spreads in general resolve the lower approach or in recessions.
Falling incomes and rising jobs? The economy is doing well but housing, industrial production and retail sales are struggling.
OK, believe what you want.
An advice
Census Bureau housing reports are best read with a shot of Pepto Bismol in your whiskey while smoking with Elon Musk.
This post originated at MishTalk.Com.
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