I got the idea from Calculated Risk to directly compare new with existing home sales. A huge "gap" exists between the two which was explained by CR as:
The initial gap was caused by the flood of distressed sales. This kept existing home sales elevated, and depressed new home sales since builders couldn't compete with the low prices of all the foreclosed properties.
The spike in existing home sales last year was due primarily to the first time homebuyer tax credit.
I took it one step further and broke out new and existing home sales by region to see where the phenomenon above had a greater impact.
The first chart shows the "gap" (i.e. the huge collapse in new home sales vs. existing).
The second is the ratio for each region over the past 10 years of new-to-existing home sales. Here we can see that each region (not surprising) was not affected the same. The areas impacted most (by far) were the west and south; the two areas hurt most by the run-up and subsequent collapse of their housing markets.
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