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2.7%  Q1 GDP    4.57%  avg. 30-year mortgage     9.5%  Unemployment

New home sales in March rocket past expectations

PASADENA, CA - SEPTEMBER 24:  A 'for sale' sig...

Image by Getty Images via Daylife

New homes sales in March shot up 27 percent from their record lows in the previous month, as home buyers rushed to take advantage of the government's purchase credit before it expires at the end of this month.

Sales rose to a seasonally adjusted annual rate of 411,000, the biggest monthly jump in 47 years and the strongest month since July, the Commerce Department said this morning.

The sales figure blew past forecasters' estimates, which expected an annual sales rate of 330,000.

The other good news is that the median sales price of a new home rose slightly compared with last year, up 4 percent to $214,000.

The downside to this good news is that the housing market remains in distortion, thanks to the continued government incentives. We won't get a clean number on home sales until June, because May will be the first month when homes are sold without any sort of government incentives (assuming that Congress does not extend the credit again).

The markets have responded favorably to the news.

In the first 45 minutes of trading, the Dow is up nearly four-tenths of 1 percent.

The broader S&P 500 is up three-tenths of 1 percent and the tech-heavy Nasdaq is up one-quarter of 1 percent.

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By Frank Ahrens  |  April 23, 2010; 10:32 AM ET
 | Tags: Business, Commerce Department, Construction and Maintenance, Government, New Home Sales, Seasonally adjusted annual rate, United States, United States Department of Commerce  
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Comments

Should be fun when all the free money runs out.
This housing stimulus is still a failure with banks not renegotiate loans and forclosures still going out of site.

Posted by: dbonade | April 23, 2010 10:47 AM | Report abuse

Thank you, President Obama!

Now, where is all the teabagger outrage on financial reform?

Oh yeah, I forgot. Dick Armey's Wall Street backers may NOT be criticized in the Teabag Party. It is VERBOTEN!

Posted by: losthorizon10 | April 23, 2010 10:49 AM | Report abuse

Loan applications (that is what you are counting) do not equal loan closings (the sale).

All people have done is lock in a rate and rebate should they eventually qualify for the loan.

Last time these figures were reported up the final sales did not materialize.

Do not count your chickens before they hatch. People who filled out the loan applications you are so happy about have until around the end of June to close.

See you at the voting booth in November.

Posted by: jace1 | April 23, 2010 10:59 AM | Report abuse

Did the author take a moment to realize that the "bad news" completely negates the "good news"? Great, housing sales are up - but that's because of a government program that's about to run out.

So what's the story Post? Don't characterize a housing market as healthy if the Government-sponsored rug is about to pulled out from under it.

Posted by: dconover | April 23, 2010 11:04 AM | Report abuse

I don't believe 27% rise in "true" home sales.

Mainly, it was the bank purchased the home back--(bank owned) & then auctioned it.

Then, the short sales, I am sure, were in the poll. Lots of short sales happening. People losing money but John Doe down the street buying it at auction and POSSIBLY remodeling. Again, I don't believe remodeling is being done like it has been reported in the press.

Another wave of foreclosures is going to happen. It was mentioned just the other day. June & July (when "program years") --can't get funded.

The 27% rise is not "solely" because of tax credits for weatherizing, solar, repaint, inspecting roofs, etc. It's because all the houses (bank owed through foreclosure) and were then auctioned.

Get it?

ANyone out their have a "power of sale" state? Arizona (bum fri** egypt he**) does and every bank is capitalizing on it big time!!!!!!

Posted by: TheBabeNemo | April 23, 2010 11:26 AM | Report abuse

Markets and economic behavior is primarily driven by emotion and beliefs. if the market starts doing better, then it does better. Stimulus is just that, gets' the market going in the right direction. Conservatives complain that the president isn't doing anything to helpe the ceconomy, then they complain that he has done something successful to help the economy. He could pooh gold until the reagan and bush era debt was retired and they would comapling that he was not going fast enough and his communist dumping of gold caused a socialist revolution and denied them their liberty.

Posted by: John1263 | April 23, 2010 11:29 AM | Report abuse

I DON'T KNOW A SINGLE PERSON WHO IS BUYING A HOME. SO WHO'S SUPPOSEDLY IS BUYING HOMES. OH GEE LET ME GUESS, THE ELITE RICH HUM.

Posted by: JWTX | April 23, 2010 11:39 AM | Report abuse

I DON'T KNOW A SINGLE PERSON WHO IS BUYING A HOME. SO WHO'S SUPPOSEDLY IS BUYING HOMES. OH GEE LET ME GUESS, THE ELITE RICH HUM.

Posted by: JWTX | April 23, 2010 11:40 AM | Report abuse

I DON'T KNOW A SINGLE PERSON WHO IS BUYING A HOME. SO WHO'S SUPPOSEDLY IS BUYING HOMES? OH GEE LET ME GUESS, THE ELITE RICH HUM.

Posted by: JWTX | April 23, 2010 11:42 AM | Report abuse

Well when you go from selling nothing to selling a couple homes that % comes up real fast. People are so stupid they'll believe anything

Posted by: jerzyguy29 | April 23, 2010 12:06 PM | Report abuse

Thanks President Obama. You're doing a great job. Americans love you.

Posted by: speckles1956 | April 23, 2010 12:15 PM | Report abuse

Percentages or Rates of increase or whatever, there is no doubt that the economy is improving and improving fast. Fast enough to getting everyone back to work next week? No but only the most ideologically blind Republican dead-end partisans can deny that Obama's steady, no drama approach to fixing the Mess that they made of America, is working.

A little credit where credit is due. Obama has saved the day!

Posted by: thebobbob | April 23, 2010 12:25 PM | Report abuse

This is not quite true people. These are a lot of the homes that were taken out of play when the banks etc. forclosed on them. Try taking out the foreclosures from the equation and you will probably see quite a different picture. We are not out of the woods yet with $$$$$. Always remember, numbers can be made to talk when and how if needed!

Posted by: jonacameronsr | April 23, 2010 12:40 PM | Report abuse

This is not quite true people. These are a lot of the homes that were taken out of play when the banks etc. forclosed on them. Try taking out the foreclosures from the equation and you will probably see quite a different picture. We are not out of the woods yet with $$$$$. Always remember, numbers can be made to talk when and how if needed!

Posted by: jonacameronsr | April 23, 2010 12:41 PM | Report abuse

Fact is the economy is still in the tank and democrats are too busy attending to their leftist legislation and special interests to care. A stalled US economy is actually key to the left's goals of slowing climate change and global redistribution.

The media keeps trying to make lemonade out of lemons by stressing individual numbers that don't reflect the whole. The problem is there is no sugar.

Posted by: Cryos | April 23, 2010 12:44 PM | Report abuse

Where were these homes? In MD the list of unsold new homes is longer than the lies the Realtors sell.

Posted by: KraftPaper | April 23, 2010 1:01 PM | Report abuse

I would be cautious about interpreting an over-the-month gain from February to March. Recall that large portions of the country were affected by massive snow storms in February that would have suppressed sales in February. It is unclear how much of the over-the-month change is due to the weather-affected February sales and how much is true improvement. I wish this point had been raised inthe article.

Posted by: EconGirl2 | April 23, 2010 1:11 PM | Report abuse

I would be cautious about interpreting an over-the-month gain from February to March. Recall that large portions of the country were affected by massive snow storms in February that would have suppressed sales in February. It is unclear how much of the over-the-month change is due to the weather-affected February sales and how much is true improvement. I wish this point had been raised inthe article.

Posted by: EconGirl2 | April 23, 2010 1:11 PM
======================
It is amazing how much the media will omit from articles and reporting to benefit democrats. Unfortunately a lot of people don't have the critical thinking and lateral thinking skills to fill in the blanks.

Posted by: Cryos | April 23, 2010 1:20 PM | Report abuse

Where were these homes? In MD the list of unsold new homes is longer than the lies the Realtors sell.

Posted by: KraftPaper | April 23, 2010 1:01 PM
=============
They must be in the non-existent congressional districts and zip codes.

Posted by: Cryos | April 23, 2010 1:22 PM | Report abuse

A "cash-for-clunkers" with homes (false blip on the overall trend). Many homes are being sold in the area to beat the government and private incentives. The new neighborhood next to ours (on its third developer as the previous ones went bankrupt) has already sold all the homes it will build in the next 14-15 months. There are actually closings for homes that have not yet been built! - I have no idea how that is done, but both the buyers and developer say they have closed. How do you do a final walkthrough and get problems fixed when you have already "closed?"

So, watch the numbers drop again next month.

Within ours and neigboring HOAs, I am also seeing closing costs included in almost every sale price. What does this indicate about the market, or credit worthiness of the buyers?

Posted by: mellwood1 | April 23, 2010 1:27 PM | Report abuse

Its ONLY because of the $6500 incentive that will end at the end of April.
Most realtors are bracing for some tough
times ahead.

Posted by: ohioan | April 23, 2010 1:37 PM | Report abuse

I'm always dismayed that a sign of our financial health is "new home starts." One of our core problems is that we already have too large an inventory of houses. How about "sales of existing homes" instead? And how about restoring current homes? The craziness and unsustainability of constantly building more houses is one of the things destroying our planet.

Posted by: judyinmichigan | April 23, 2010 1:42 PM | Report abuse

Do these numbers reflect houses that have gone under contract or actual settlements?

If it's houses that have gone under contract, that will come to a screeching halt May first.

If it's houses that have settled, that will come to a screeching halt July first.

Any increase in prices that was gained during the past few months will be reversed starting May first because if the buyer is not under contract by April 30, the buyer does not get the tax credit.

Until Oboob starts paying attention to unemployment (there's always something more important - health care, immigration, cap and trade, VAT) the housing market will not stabilize.

Posted by: waterfrontproperty | April 23, 2010 2:12 PM | Report abuse

Those who are lucky enough to buy a new home should still get a home inspector to look over even newly-built homes. But don't ask your realtor to recommend a good home inspector, as that's a definite conflict-of-interest. Many home inspectors rely on the referrals from realtors to get clients. Since they depend upon them for business, they're less likely to tell prospective buyers bad news that could be a deal-breaker.

Realize that there a lot of things inspectors will NOT do -- like, they don't have to climb up on the roof. Ask before hiring him. Often they have very little, if any, training. Some 16 states, like California, have no regulations for home inspectors. Those states that do have regs, often have every few.

The American Society of Home Inspectors has about 5,000 inspector-members and their standard procedures have been adopted by the industry. It is really helpful and clarifying to read the ASHI Code of Ethics at:

http://www.ethicsoup.com/american-society-of-home-inspectors-code-of-ethics.html

Posted by: s_mceachern | April 23, 2010 2:50 PM | Report abuse

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