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Thursday, June 23, 2011

New Home Sales Flatlines

Reuters details:
The Commerce Department said May new home sales fell 2.1 percent to a seasonally adjusted annual rate of 319,000. Analysts polled by Reuters were expecting a slightly slower pace of 310,000 for the month.

The decline ended two straight months of strong gains, with sales rising 6.5 percent in April and 8.9 percent in March. May's new home sales were 13.5 percent above the May 2010 level.
Lets take a look at those recent "strong gains" by sale price.

And relative to the longer term by region (note that "strong gains" in percent terms are easy when the base is 80% below previous peaks).

As GYSC noted in a previous post:
I cannot believe how many run thier game under "The FED is behind us no matter what!". 
While that is a great trade when the market simply needs liquidity, as seen above it doesn't help so much when the asset has fundamental issues.

Source: Census