Dueling Narratives on New Home Sales

Elsewhere in the 'net today, you'll find headlines about 'new housing sales increase.'

Well, yes....but increase from what?

...Sales of new single-family houses have been zigzagging along low levels for months. In October, they rose 7.5% from September, after having plunged 11% in September, according to the Census Bureau today. At a seasonally adjusted annual rate of 632,000 houses, they were down 5.8% from the already low levels a year ago, and down 37% from two years ago....

There's a graph at the link; the REAL high in sales was 2004 or so.

But the sales mentioned above are sales before contract cancellations.

Hmmmm.

 ...According to the homebuilder survey by John Burns Real Estate Consulting – with a sample size of roughly 20% of all new home sales – the cancellation rate spiked to 25.6% in October, up from a rate of 7.9% in October 2021 and from 10.9% in October 2019. Over a quarter of the signed contracts are cancelled!...

Sales are up, deliveries are down.

That's not a good scenario.