{"id":1646,"date":"2020-01-27T12:41:19","date_gmt":"2020-01-27T17:41:19","guid":{"rendered":"https:\/\/naroffeconomics.com\/?p=1646"},"modified":"2020-01-27T12:41:19","modified_gmt":"2020-01-27T17:41:19","slug":"december-new-home-sales","status":"publish","type":"post","link":"https:\/\/naroffeconomics.com\/?p=1646","title":{"rendered":"December New Home Sales"},"content":{"rendered":"\n

KEY DATA:<\/strong>  Sales (Month): -0.4%; 2019 vs. 2018: +10.3%<\/p>\n\n\n\n

IN A\nNUTSHELL:<\/strong>  \u201cBuilders had a good 2019, but sales look like\nthey plateaued at the end of the year.\u201d<\/em><\/strong><\/p>\n\n\n\n

WHAT IT\nMEANS:<\/strong>  If the economy is going to pick up any\nsteam, the housing sector needs to play a key role.  While the existing market did fine at the end\nof the year, sales of new homes were down modestly in December.<\/em><\/strong>  That was the third consecutive monthly drop.  Comparing 2019 to 2018, sales soared.<\/em><\/strong>  But even there, we have to read the data\ncarefully.  The East and Midwest posted sharp\ndeclines in annual sales. However, double-digit gains in the South and West\noverwhelmed those cut backs.<\/em><\/strong>  But\nthere was some question about those increases, especially in the West.  In December 2018, sales in the West were the\nlowest in over three years.  However,\nthey doubled \u2013 yes doubled – from that pace in December 2019.   That makes no sense.  So, you have to conclude that the large\nincrease in annual sales was somewhat overstated.  Stepping back from the data anomalies, it is\nlikely that demand is improving somewhat, but it is hard to believe there will\nbe any major increases going forward, especially given the limited supply of\nhomes on the market.  <\/em><\/strong><\/p>\n\n\n\n

The Dallas Fed\u2019s Texas Manufacturing Outlook Index\nrose a touch in January, though the details were better than the headline\nnumber.  New orders and production levels\njumped<\/em><\/strong>,\nwhile wage gains continued to accelerate somewhat.  What kept the overall index down was weakness\nin hiring, hours worked and capital expenditures.  In addition, order books continued to thin,\nthough not quite as quickly as they had been. \nExpectations did improve.  At\nleast for one part of the country, manufacturing is improving.  MARKETS AND FED\nPOLICY IMPLICATIONS:<\/strong>Clearly,\ninvestors are concerned about the potential impacts of the coronavirus.  Given China\u2019s lockdown of millions of people,\nthere is reason to worry about how much further it will spread and what the\nshort-term impacts will be on Chinese and world economic growth<\/em><\/strong>. It is\neasy to say that in past health crises similar to this, the actual effects were\na lot less than what were feared and we can hope that is the case once again. Unfortunately,\nwe just don\u2019t know and uncertainty is never good for the economy or the\nmarkets.<\/em><\/strong>  Given the U.S. is expanding\nat a modest to moderate pace and there are few if any indicators pointing to a\nmajor acceleration in growth, any negative impact could push the pace of\nactivity toward quite low levels.  But,\nwe just don\u2019t know.  Thus, the\nmonthly data should take on added importance, as it would be nice to know we have\na buffer just in case the health issues do have a negative impact on the\neconomy. <\/em><\/strong> But for now, the only\nthing that can be concluded is that the economy is in decent shape.  That should keep Fed Chair Powell from\npanicking again if the markets decline, but who knows what he is trying to\naccomplish. \n\n\n\n<\/p>\n","protected":false},"excerpt":{"rendered":"

KEY DATA:  Sales (Month): -0.4%; 2019 vs. 2018: +10.3% IN A NUTSHELL:  \u201cBuilders had a good 2019, but sales look like they plateaued at the end of the year.\u201d WHAT IT MEANS:  If the economy is going to pick up any steam, the housing sector needs to play a key role.  While the existing market … Continue reading December New Home Sales<\/span> →<\/span><\/a><\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-1646","post","type-post","status-publish","format-standard","hentry","category-uncategorized"],"_links":{"self":[{"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=\/wp\/v2\/posts\/1646","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=1646"}],"version-history":[{"count":1,"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=\/wp\/v2\/posts\/1646\/revisions"}],"predecessor-version":[{"id":1647,"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=\/wp\/v2\/posts\/1646\/revisions\/1647"}],"wp:attachment":[{"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=1646"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=1646"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=1646"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}