Wednesday, December 23, 2009

Sales of U.S. New Homes Unexpectedly Fell in November

“The tax credit put a Band-Aid over the housing problem and in October and November we ripped it off” as it was set to expire, said Mark Vitner, a senior economist at Wells Fargo Securities LLC in Charlotte, North Carolina, who projected sales would fall. “Demand for housing is not likely to pick up on a consistent basis until we start to see some improvement in employment.”

Record foreclosures are also restraining housing by driving down prices.

The median home price to gold ratio (MHPGOLDR) removes the influences of currency devaluation on home prices. When home price trends are studied in terms of stable currency such as gold, it suggests that further deterioration in the coming years. The 1979 and 1983 gold adjusted price magnets are pulling hard.

MHPGOLDR:

The median home price to months supply ratio (MHPMSR) suggests that even without acknowledgement of the shadow inventory of foreclosed homes price will continue to struggle with overhead supply.

MHPMSR:

Source: http://www.bloomberg.com/apps/news?pid=20601087&sid=a4.G0b6mel5A&pos=1

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