New Home Build sale drop significantly. May, 2024

 CNBC article highlights new build weakness. 

See article here. 

The Highlights: 

Sales of newly built homes dropped 4.7% in April compared with March and fell 7.7% from the prior year the US consensus said Thursday.

March sales were also revised significantly lower.

Weitz take: So tired of downward revisions by the government. How is it so hard to get those figures right and why release them until you do have them accurate? 

Builders say they cannot lower prices due to the high cost from labor and materials.

Weitz take: Ummm hmmm.... Their profits would indicate otherwise. 

For all the happy talk from the big builders the entire build industry is selling new homes at a pace below the five year average according to Bleakley Financial Group.

With the nationwide shortage of roughly 1.5 million homes the lack of housing units is the primary cause of growing housing affordability challenges policymakers at all levels of the government need to enact policy changes that will allow builders to construct more homes such as speeding up permit approval times providing resources for skilled labor training and fixing building material supply chains” cited Robert Dietz, the NAHBs chief economist.

Weitz: this is so true. The bureaucracy of local governments has become totally outrageous. The length and costs of simply having the 'approval/ right'  to construct does not coincide with the huge need for reasonably priced housing. 

Overall, this coincides with my call for a top in the market in the near future (if not now). It's all about inventory, but if new homes are not selling, that will add onto the inventory levels and as I've said, that is the #1 indicator for prices as we move forward.