13 replies to this topic

[OEXCHAOS]

April new-home sales in U.S. unexpectedly leap 16%

I suspect that they just dropped prices and pushed hard to get some inventory off their hands.

I doubt we'll see that in existing homes...

Mark

[peregrine]

Existing home sales units may be better than recent trend, which is not saying much......but the price data will be skewed by the upper tiered, more expensive homes.

[spielchekr]

Locking in lower rates, locking out higher rent. I can hear the pitch in my mind.

Edited by spielchekr, 24 May 2007 - 09:50 AM.

[atlasshrugged]

April new-home sales in U.S. unexpectedly leap 16%

I suspect that they just dropped prices and pushed hard to get some inventory off their hands.

I doubt we'll see that in existing homes...

Mark

The builders have so many tricks up their sleeves with throwing in free uprgades, cash back incentives, rate buy downs that these numbers are easily maipulated.

I did 20 properties in Phoenix in Feb where the builder offered a huge cash back incentive!

[Cirrus]

I've read a few articles about residential RE numbers releases. Saying they are fraught with 'inaccuracies' is a gross understatement. The shorts have gotten killed in the DJUSHB. We have a nice rally and today's very unexpected good news will make a nice cap. I shorted a little earlier. I wouldn't be surprised to see marginally higher highs on the DJUSHB. I'll look to short more with a stop a few percent above today's DJUSHB high.

[OEXCHAOS]

So I gather, IC. I put myself in a builder's shoes. I've cut every cost I can, and I'm sitting on a several million in homes, OR, I've got lots that I have to sell and equipment and staff and debt that I have to take care of. If I want to stay in business, I have to do SOMETHING to get rid of the inventory and keep my people busy and pay down or just service debt. I NEED to do that, I DON'T NEED to make a profit initially. I just want to hang on. I also bet that there's some shady stuff going on, too. Maybe some risk financings by the builders themselves. I'm sure that there's plenty of stuff that they can do, too, to dump homes on folks without it looking like huge price cuts to the outside world, or their banks. Meanwhile, I'm just not seeing much activity by realtors in re the places for sale around here. I actually hope it's better elsewhere (I mean besides Semi's neighborhood ). Mark

[SemiBizz]

Location, Location, Location. It's no surprise the housing dip is being bought. The trend is your friend. If commodity prices are not coming in then all types of equities are going to explode to adjust to it, that includes R.E. And that dip gets bought on the high end first, which explains the strength here, because those buyers are more liquid, and we don't have any new building to speak of, so there's your hot money chasing it. Business is better in Silicon Valley these days. I'm working with three new startups, medical electronics, consumer and even clustered supercomputers. You would not believe how aggressive these venture/private equity guys are getting to fund these things, reminds me of 1999 all over again. Only this time you have to have a real concept that makes sense. Hey, we've had a tough 7 years since 2000, I think the surprises are all going to be on the upside, starting with the US $.

[Cirrus]

A little insight into today's RE numbers: >The real story behind the housing numbers is that the median price dropped from $257,600 in March to $229,600 in April. Many more homes sold in April than March in the below $199,000 catagory. Every price catagory above was flat or down. This tells me that builders are discounting heavily the entry level segment trying to unload the lower priced homes quickly as qualification standards for entry level are now higher and reducing the number of buyers for that price range.<

[atlasshrugged]

So I gather, IC.

I put myself in a builder's shoes. I've cut every cost I can, and I'm sitting on a several million in homes, OR, I've got lots that I have to sell and equipment and staff and debt that I have to take care of. If I want to stay in business, I have to do SOMETHING to get rid of the inventory and keep my people busy and pay down or just service debt. I NEED to do that, I DON'T NEED to make a profit initially. I just want to hang on.

I also bet that there's some shady stuff going on, too. Maybe some risk financings by the builders themselves.

I'm sure that there's plenty of stuff that they can do, too, to dump homes on folks without it looking like huge price cuts to the outside world, or their banks.

Meanwhile, I'm just not seeing much activity by realtors in re the places for sale around here. I actually hope it's better elsewhere (I mean besides Semi's neighborhood ).

Mark

In Vegas there are entire neighboorhoods for Sale I am not kidding either. I heard 40% of the houses for sale are vacant..which scares the bejesus out of me! My house has been on the mkt for 3 months priced a little over a mill and I even offered to throw in their choice of a porsche, jag, s-500 or hummer and still havnt had a bite! I am even offering a MONSTER 6% commission to the buyers agent!

I shorted that SRS fund two days ago in my IRA. this decline is going to go for a long long time

[Data]

The sales are actually new orders, not to be taken as actual closed purchases. Recent cancellation rates for the public builders have been anywhere from 20 to 35 percent. When the numbers are revised, they could show that April sales were actually flat or lower.

Edited by Data, 24 May 2007 - 12:07 PM.