New Home Sales Collapse In April

Tyler Durden's picture

If you're surprised by the collapse in new home sales in April, then you're not paying attention.

The 11.4% MoM plunge in new home sales in April was 5 standard deviations below expectations and the biggest since March 2015.

 

Year-over-year, new home sales have tumbled back to unchanged...

 

As the surge in mortgage rates (and tumble in affordability) filters through to actual sales (just as it did in 2013's taper tantrum)...

 

New home sales fell 73k in April, with the Median new home price falling 3.8% y/y to $309,200

12% of new homes sold in April cost more than $500,000, down from 18% last month. Months’ supply at 5.7 in April compared to 4.9 in March.

And the biggest driver of new home sales collapse was in The West - which saw a 26.3% collapse - the most since Oct 2010...

 

Probably a good time to hike rates again Janet, eh?

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NoDebt's picture

It was like really cold and stuff in April.

 

Haus-Targaryen's picture

Come on Mr. Yellen, raise rates. 

yrad's picture

For the last time, rates have not "surged". I locked my 3.875% in April of 2012. Rates are now at 4.000%. Yes, YUGE surge!!!

 

exi1ed0ne's picture

An inch doesn't seem like a lot of space, except when you are on the edge of a cliff.  

Raffie's picture

My muffin hardly had any blueberries but my friends muffin had a ton of blueberries.

Last of the Middle Class's picture

Que the NAR propaganda! This is your new economy on Obamacare! Get used to it, because, for Gods sakes we HAVE to cover pre-existing conditions of dumb-asses who just simply chose not to buy insurance until they got the doctor's bill. LMFAO!!

Offthebeach's picture

Nows a good time to buy a $300k starter home.  In a "diverse" neighborhood.   $3-4k taxes.  Plus fees fir municipal services.  Got kids?  School bus fees, after school athletic fees. ( section 8, gimmygrants excepted )

 

 

Juggernaut x2's picture

$3-4G taxes? unless you live in a few SE US states you will be lucky to find them that low

Harry Paranockus's picture

Try the east valley Phoenix area.

Offthebeach's picture

Actually live in Massachusetts. My  local real estates taxes run about 1%  of assessment. 

sharonsj's picture

Prior to the ACA, people born with birth defects were considered to have pre-existing conditions and could not get insurance, you effing dumb ass.  Prior to the ACA, people who developed cancer or any other diseases were considered to have pre-existing conditions and could not get insurance, you effing dumb ass.  According to you, we should just let them die.

Juggernaut x2's picture

But how much is enough? $100K? $1M? $1B? The center cannot hold.

HumanMan's picture

You're right. Let's keep ACA until it collapses on its own.

Last of the Middle Class's picture

Just so you know. there were always programs to cover those of which you speak. Grab a book, do some reading, and if you have to cranial capacity try a bit of critical thinking along with knowing the facts before you make a complete ass out of yourself regurgitating "fake news propaganda" designed to scare one into more government. "For the sake of the babies" But hey, you're well on your way to being snowflake of the year!

1033eruth's picture

I'll let them die.  It does nothing to my conscience.  You, open up your wallet and empty it for them (its called charity) since you simply can not live unless you can steal  from your fellow man for the "common good".

Bill of Rights's picture

Yet when Odumbass was in office it was red roses and Unicorns...for Eight strait years...funny that.

John Law Lives's picture

Somehow this must be spun as bullish by The Machine That Pumps Equities No Matter Wha...

FUBAR 

jamesmmu's picture

WTF! Stocks rallied on this news?!

Stormtrooper's picture

Algos don't have to live in a house and pay a mortgage so everything is bullish.

Winston Churchill's picture

Even the RE speculators have started to lose money according to one of my  clients.

He just sold three spec houses at a loss, just to get out.Just put his Florida home on the market as well.

He's very well connected.

espirit's picture

 

Well it is possible to look at it from the perspective that a rising tide floats all houseboats.

 

clade7's picture

Oh well, easy come, easy go....

tuetenueggel's picture

What you call houses, in Europe are build as dog- or cattle shacks.

One a bit stronger wind and only the concrete plate is left.

swmnguy's picture

Most new houses are overpriced and way the hell out in the sticks.  If you want to live in a particle-board shack an hour from where you work, shop and send your kids to school, in places that don't have sidewalks or parks and you can't do anything--in some places, even pick up your mail--without driving at least ten minutes, you can spend 6x the median household income for that privilege.

Existing houses are overpriced too, but at least they've stood there a while so it's a decent bet they'll keep standing there.  And where people have lived for a while, there are usually stores and schools and home mail delivery.  Heck, my wife and kids ride bikes to work and school.  The kids take buses to go to the mall and the movies and wherever the hell else they want to go, and they can toss their bikes on the rack on the front of the bus and off they go.

Your preference.  I have mine.

The real point is that cheap money has allowed prices to skyrocket, and they're going to correct.  If you earn 3-4x median, or have sufficient equity you'll be fine.  If not, you'll get wiped out.  Like always.  If interest rates were at historical levels, prices would plummet and monthly payments would barely move because that's what people either can or can't afford.  But since that would strand a lot of people who overpaid for their houses a decade ago, more likely we'll start seeing 40 year mortgage.  Hell, in Beijing once a cabbie told me he was paying what worked out to be USD$200,000 for a 600 square-foot apartment.  On an 80-year mortgage he was assuming from his father and planning to pass on to his son.

See?  There's always a solution.

Harry Paranockus's picture

Apparently you haven't been to the valley east of Phoenix area.

directaction's picture

You are correct!

At least 75% of homes in Scottsdale and lands nearby are owned by poofters, fruitcakes, fisters, fags, nelly-boys, and a few wanna-be homos prancing around in their skin-tight high-shorts desert hipster gear. 

Hitlery_4_Dictator's picture

My land is my own park, I don't need government to build one for me, nature already made me one for free.  I live an hour away from a major city....it's much calmer here. Not only that but I have privacy, and it only cost me 114k.

NEOSERF's picture

6 Sigma jumps are so yesterday....they are what 2 sigma jumps were in 1985....when you start seeing 10-20 sigma jumps wake me

buzzsaw99's picture

new houses are insanely expensive. lower interest rates will fix this.

tuetenueggel's picture

Latest FED offer for lenders:

500.000 on 30 years.

interest - 10 %  after 30 years you´ll have 100.000 to be payed to your account.

 

 

ToSoft4Truth's picture

Poor Carrier staff. 

Consuelo's picture

 

 

> Just the prescription of plausibility the Dr. ordered (for the Fed)...?

Or -

> Janet proceeds to fire tube #1 for the Deep State...?

wmbz's picture

Just a blimp, everyones knows... There has never been a better time to buy a house!

That plus the summer buying season is coming up, along with all those cash ready buyers sitting on the sidelines.

silverer's picture

Endless prosperity has made the sheeple filthy rich. Buy! BUY!

rent slave's picture

They running out of Jews and chinamen to "invest" in these.

Blano's picture

ZH with the needless hype again.

Surging rates??  Really?? In what universe??

I expect better from a source of financial news.

hangemhigh77's picture

Everything is awesome.

hangemhigh77's picture

The Chinkafication of the USA is slowing down. Americans are the shine boys of the world. Hang all politicians and all banksters.

BSHJ's picture

Don't home sales always fall at the end of the school year, right before the summer buying season?

OCnStiggs's picture

I thought they shot up at the end of the school year because people are free to move once their kids get out of school. I thought it collpased at the end of summer as people gt ready for the next school year.

Where I live, the market tanks in Jun with the heat spike and doesn't come back until October.

Bad Goy's picture

Jack those rates!  Crash the housing market.

decentralisedscrutinizer's picture

 

Almost all the world’s economic and political problems revolve around the hegemony of a global corporate cartel, which is headquartered in the US because this is where their military force resides. The only way to regain our sovereignty as a constitutional republic is to severely curtail the privileges of any corporation doing business here. As a free nation, we really have to stop granting corporate charters to just any “suit” that comes along without fulfilling a defined social value in return. The "Divine Right Of Kings” should not apply to fictitious entities just because they are “Too Big To Fail”. We can't take the incorporation of private transnational banks for granted anymore. The government must be held responsible only to the electorate, not fictitious entities, if we are ever to restore sanity, much less prosperity, to the world.

 

 

 

It was a loophole in our Constitution that allowed corporate charters to be so easily obtained it created a swamp of corruption around our capital. It is a swamp that can't be drained at this point because the Constitution  doesn’t provide a drain. This 28th amendment is intended to install that drain so Congress can pull the plug ASAP. As a matter of political practicality we must rely on the Article 5 Convention for which the electorate will need consensus beforehand. Seriously; an Article 5 Constitutional Convention could solve that problem in days. This is what I think it will take to save the world; and nobody gets hurt:

 

 

 

28th Amendment

 

Corporations are not persons in any sense of the word and shall be granted only those rights and privileges that Congress deems necessary for the well-being of the People. Congress shall provide legislation defining the terms and conditions of corporate charters according to their purpose; which shall include, but are not limited to:

 

1, prohibitions against any corporation;

 

a, owning another corporation,

 

b, becoming economically indispensable or monopolistic, or

 

c, otherwise distorting the general economy;

 

2, prohibitions against any form of interference in the affairs of;

 

a, government,

 

b, education, or

 

c, news media, and

 

3, provisions for;

 

a, the auditing of standardized, current, and transparent account books, and

 

b, the establishment of a state and municipal-owned banking system

 

c, civil and criminal penalties to be suffered by corporate executives for violation of the terms of a corporate charter.

 

 

 

The Founders had to fight a bloody Revolutionary War to win our right to incorporate as a nation – the USA. But then, for whatever reason, our Founders granted the greediest businessmen among them unrestricted corporate charters with enough potential capital & power to compete with the individual States, smaller sovereign nations, and eventually to buy out the Federal government itself. Now that these fictitious entities own the USA and command its military infrastructure, by virtue of the Federal Reserve Corporation, and run it by virtue of regulatory capture, MSM propaganda, and Congressional lobbying they’ve set their sights on the creation of an all-inclusive global financial empire. The US Constitution is the “Kingpin” of the whole global Machine.