U.S. New-Home Sales Fell in December to Lowest Level on RecordThe “consensus” for jobless claims was 575,000… you can see how that worked out:
By Bob Willis
Jan. 29 (Bloomberg) -- Sales of new homes in the U.S. fell in December to the lowest level on record after banks tightened lending and job losses mounted.
Purchases dropped a more-than-forecast 15 percent to an annual pace of 331,000, the lowest level since at least 1963, according to a report from the Commerce Department today in Washington. Other reports showed orders for durable goods slumped for a fifth month and a record number of Americans were collecting jobless benefits.
The drop in home purchases indicates the housing slump at the center of the global credit crisis and economic downturn will persist well into 2009. President Barack Obama has pledged to stem foreclosures and boost job creation to break the longest recession in a quarter century.
``We're still in the middle of a severe decline in the housing market,'' Ethan Harris, co-head of U.S. research at Barclays Capital Inc. in New York, said before the report. ``The escalation of the capital-market crisis this past fall caused a reacceleration in the problems in housing. People are holding back on buying with the increase in the uncertainty about the economy.''
Economists forecast new home sales would drop to a 397,000 pace, according to the median forecast in a Bloomberg survey of 70 economists. Estimates ranged from 345,000 to 412,000. Commerce revised the November sales pace down to 388,000 from the 407,000 rate previously reported.
Goods Orders, Claims
Orders for durable goods fell 2.6 percent in December, more than anticipated, other figures from Commerce showed. The declines signals a slump in business spending will deepen and prolong the recession.
A Labor Department report showed a record 4.8 million fired workers received unemployment benefits in the week ended Jan. 17. First-time filings last week increased 3,000 to 588,000.
The median price of a new home decreased 9.3 percent from the same month last year to $206,500, the lowest in five years. Sales of new homes were down 45 percent from December 2007.
For the full year, sales fell a record 38 percent to 482,000, the fewest since 1982, Commerce said. The median price fell 7 percent, the most since 1970, to $230,600.
The housing report showed builders were unable to trim inventories as fast as sales dropped. The number of homes for sale fell 10 percent to a seasonally adjusted 357,000, the fewest since Sept. 2003.
The supply of homes at the current sales rate jumped to a record 12.9 months' worth. That is more than twice as much as the five-to-six months supply that the National Association of Realtors has said is consistent with a stable market.
Sales of new houses dropped in all four regions, led by a 28 percent decrease in the Northeast and a 20 percent slump in the West.
In a report free of special factors and pointing clearly to severe contraction in the labor market, initial jobless claims rose 3,000 in the Jan. 24 week to 588,000. The prior week was revised slightly lower to 585,000. The four-week average jumped 24,500 to 542,500.Continuing claims exceeded the levels reached in the 1974 and 1982 recessions…
Continuing claims show special weakness and indicate that the unemployed are not finding work. Continuing claims for the Jan. 17 week, the most recent data available, jumped 159,000 to a record 4.776 million. A comparison with mid-December shows a 404,000 gain for continuing claims.
These reports pretty much are continuing to go from ashes to ashes…
David Bowie – Ashes to Ashes: