THE BASIS POINT

Fundamentals 9/26: New Home Sales 6mo Low (CHART)

Housing
-New Home Sales for August were 295,000 (annualized)
-Previous was 298,000
-This is a 6-month low
-Prices were -7.7% year-on-year, worst since July 2009
-This is despite lower prices and record low mortgage rates.
-New Homes are important to economic growth: they provide jobs for the workers who build them and many other jobs for the people who make the materials which build them and things such as carpet, paint and appliances. Home Sales remain low because the market is still glutted with inventory, prices are falling and people have too little confidence. In addition, mortgage qualification is tougher. Other than that, things are fine.
New Home Sales

Chicago Fed National Activity Index
-This is a weighted average of 85 existing monthly indicators of U.S. economic activity.
-Index level -.43
-Previous was +.02
-3-Month Average -.28