Housing, Still Dropping Like A Stone

Mike Larson looks at today's numbers:

We got a real one-two punch of dismal housing data this month, with today's new home sales report looking just as ugly as yesterday's existing home sales release.

Not only did the pace of sales fall to the lowest level since at least 1963, but a key measure of supply exploded to a record high. The raw supply of homes for sale is clearly dropping. But because sales are falling even faster, we're not seeing any net improvement in the market. Result: Prices continue to fall, with new homes now going for the least in more than five years.

It really does all come down to jobs, jobs, and jobs. Lower mortgage rates are nice. Tax cuts are nice. But with the labor market deteriorating so sharply, we're unlikely to see a meaningful improvement in the housing market. If anything, sales and pricing will deteriorate further.