Afternoon Note
Whoa, we got another major report on housing with Pending Home Sales Index (PHS) report that crushed consensus estimate by coming in at a ten year high. The PHS is a leading housing indicator and measures signed contracts for existing single family homes, condos and co-ops.
Regional Trends |
PHS Index |
Change M/M |
Change Y/Y |
Northeast |
98.2 |
1.20% |
+11.21% |
Midwest |
112.9 |
0.10% |
0.71% |
South |
133.9 |
6.8% |
3.96% |
West |
106.2 |
11.40% |
3.81% |
Total |
116.3 |
5.10% |
4.20% |
This piggy backs off the new home sales from Monday. The most amazing part of that report was the pop in median price to $321,100 from $297,900 in a single month. That trend probably stays in place for a while as months supply tumbled to just 4.7 from 5.5 months.
Regional Trends |
Sales (000) |
Change M/M |
Change Y/Y |
Northeast |
55 |
+52.8% |
+323.1% |
Midwest |
60 |
-4.8% |
-9.1% |
South |
352 |
+15.8% |
+18.1% |
West |
243 |
-0.4% |
+17.4% |
Total |
619 |
+16.6% |
+23.8% |
Couple the data on housing with the Durable Goods report that came in better than expected and its beginning to seem like a slam dunk the Fed is going to hike rates. I think it’s a mistake for many reasons, including the fact business investment in the durable goods report were unchanged again.
I need to see jobs data before I jump on this bandwagon. The good news is if conventional wisdom holds, a hike is now inevitable in June or July and the market isn’t collapsing, ant that is a major positive signal. So let’s enjoy the revival in home sweet home even if it means the Fed becomes embolden in a way that harms the rally.
Comments |
I wonder if PHS hasn't spiked due to people anticipating a surge in mortgage loan rates? If this is the case, will the surge continue or fizzle out? George E on 5/26/2016 3:01:16 PM |
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