The 3.4% August U.S. new home sales drop
The 3.4% August U.S. new home sales drop to an expected 560k rate followed net downward revisions to leave a slightly weaker than expected report. The August new home sales drop included a 4.7% decline in the south, and Harvey and Irma will likely depress sales through September before a Q4 bounce. The median price fell 6.2%, while inventories surged 3.6% to an 8-year high of 284k. Analysts expect average new home sales rates of 563k in Q3 and 586k in Q4, after rates of 603k (was 613k) in Q2 and a 617k cycle-high in Q1. The climb from cycle-lows for the various housing measures has been erratic since the Fed's "taper tantrum" in mid-2013, and the climb has been weaker for the various sales measures than for the construction aggregates. New home sales have risen 107% from the 273k record-low in February of 2011, alongside smaller cyclical climbs of 43% for pending home sales and 55% for existing home sales from lows in 2010. Analysts saw big cyclical climbs of 147% for housing starts and 153% for permits from lows in 2009, and 172% for new home construction from a low in 2011.