Preview: Due November 25 - U.S. October New Home Sales - Several signals for weakness
We expect a 6.1% decline in October new home sales to 635k, which would be the lowest level since February. Even this would leave new home sales looking more resilient than other measures of housing demand.
Upward pressure on mortgage rates is clearly having an impact, with survey evidence from the NAHB and MBA slipping in October, and a sharp fall in September pending home sales preceding a similar plunge in October existing home sales, which fell to a 16-year low.
We expect declines in each of the four regions though expect the South, the largest region, to be relatively resilient. Price data is likely to be on balance weak, with monthly data showing a 2.0% decline in the median but a 1.0% increase in the average. This would leave the median at -2.9% yr/yr from -3.9% and the average at –8.8% yr/yr from -6.7%.
