According to data released by the US Census Bureau on 23rd December, New home sales dropped by 11.3 per cent in November to an adjusted annual rate of 355,000. That was the lowest level in seven months. The good number for existing home sales last month seem to have cannibalized new home sales, as well as the tax break extension into next year announced by the Obama Administration.
The Case-Shiller 20 index published by Standard & Poor's today shows that home prices were flat and failed to keep pace with gains so far in 2009. The figures are not seasonally adjusted (+0.4% seasonally adjusted – the fifth straight improvement). In the past year, prices are down 7.3% in the 20 cities.
These numbers are not showing the beginning of a double dip in the housing market as yet. I will, however watch them very carefully in the coming month.
U.S. Census Bureau: New Residential Sales in November 2009
Financial Times: Sales of new US homes plunge unexpectedly
Standard & Poor’s: S&P/Case-Shiller Home Price Indices - October 2009
The New York Times: Slight Rise in Home Prices Masks Signs of Weakness