Tuesday, April 25, 2006

Sales Up Tiny Bit; Inventory and Prices Rise Bigtime

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David Lereah, chief economist for the National Association of Realtors, said it again just like he said it before and again before that.

"This is additional evidence that we're experiencing a soft landing."

Lereah is talking about how the sales of existing homes went up a miniscule .3 percent in March. No, that's not a stain on your monitor that's .3, as in POINT THREE, as in LESS THAN ONE.

And the response to Lereah's comments from those in the Bubble Blogosphere is "Wha, wha, wha, what?"

Look at the report and you'll see that this very, very small increase in sales was also marked by an increase in the national median price for existing homes (up 7.4 percent from 2005 to $218,000), as well as an increase in inventory (an increase of 7 percent to 3.19 million existing homes, or a 5.5 month supply).

So, add it up -- higher prices + more inventory + minor increase in sales = rollercoaster at top of hill, about to plunge back to earth.

Pop goes the ...

Here's an excerpt from Marketwatch:
Sales of existing homes rose unexpectedly in March by 0.3% to a seasonally adjusted annual rate of 6.92 million, the National Association of Realtors said Tuesday.

"After five months of declines, existing home sales have risen two months in row, prompting David Lereah, chief economist for the realtors, to say, "This is additional evidence that we're experiencing a soft landing."

"This is a mixed report, but encouraging," Lereah said.

Sales are down 4% year-to-date.

"Sales are leveling out," Lereah said. He's forecasting a 6% drop in existing home sales this year. Economists expected sales to fall to a 6.70 million pace in March, according to a survey conducted by MarketWatch.
Get real. This bubble's popping.

-- The Boy in the Big Housing Bubble/Los Angeles and Beyond