Something’s fishy about the New Home Sales numbers

Housingwire cites Zerohedge? I like it.

Is there more trouble hidden in November’s new home sales data?

But a deeper dive into the new home sales data shows that November’s increase over October isn’t quite as promising as it appears.

The folks over at Zero Hedge spotted a potentially troubling trend of the new home sales data being continually revised down, making each month’s figures look not nearly as positive as first reported.

For example, the initial estimate for October’s new home sales data was a seasonally adjusted annual rate of 495,000, so the revised data released Wednesday showed a downward revision of 25,000.

With November’s new home sales data printing at a seasonally adjusted annual rate of 490,000, November’s new home sales are actually lower than October’s initial total.

But comparing the November’s initial estimate to October’s revised total is not an apples-to-apples comparison, but a further look at the year’s data shows why November’s data could look a whole lot different in about a month when December’s data is released.

As Zero Hedge noted, the last five months have each been revised downward from the initial projections.

September’s initial report showed a seasonally adjusted annual rate of 468,000, but the current data from the Census and HUD shows that the revised total for September is actually 442,000, a decrease of 26,000 over the initial total.

The difference between August’s initially reported totals and the revised figures are even more significant.

When September’s initial report came out, the initial estimates had new home sales collapsing 11.5% from what was then August’s revised total of 529,000. But since then, August’s total has been revised even further.

August’s initial report showed at a seasonally adjusted annual rate of 552,000, but the current revised total is 507,000, a decrease of 45,000 from the initial report and a decrease of 22,000 from what was reported in October.

So the actual decrease from August to September was 84,000, not 65,000 as it was initially thought to be.

October, September and August were not the only months where the new home sale data has been revised down.

July’s initial report showed at a seasonally adjusted annual rate of 507,000, but the current revised total is 500,000, a decrease of 7,000.

June’s total was revised down from 482,000 to 469,000, a decrease of 13,000.

May’s total was revised down from 546,000 to 513,000, a decrease of 33,000.

And April’s total was revised down from 517,000 to 508,000, a decrease of 9,000.

So, for the last seven months, the average reduction from the initially reported new home sales data is approximately 22,570.

Subtract that average reduction of 22,570 from November’s total of 490,000 and November’s new home sales print at an estimated 467,430, which would represent a decrease of approximately 3,000 from October’s revised total, not an increase as was initially reported.

So, will next month’s report showed that new home sales actually fell in November?

The math certainly seems to show that that is exactly what happened.

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38 Responses to Something’s fishy about the New Home Sales numbers

  1. D says:

    Happy Christmas Eve!

  2. Comrade Nom Deplume, the anon-tidote says:

    Merry Christmas Eve from the tarmac at PHI.

  3. The Great Pumpkin says:

    He takes a similar position to mine, we are on the brink of a huge boom. Man, all the signals are there. Falling energy and commodity prices, tightening labor market, low rates, baby boomers on the brink of massive retirements which will lead to job creation for the younger generation(who will spend it)…..man, I can go on and on. This is a powder keg in the making, you just have to open your eyes and see the writing on the wall.

    This guy is like me, called the crash, and rightfully so, has now changed his position in anticipation of the “comeback”.

    “Paul Solman: In 2005, Charles Morris became convinced that a debt crash was inevitable. In 2006, he began his 10th book to make and explain his prediction. In 2007, he delivered the manuscript, and at the beginning of 2008, Public Affairs Books published “Two Trillion Dollar Meltdown: Easy Money, High Rollers, and the Great Credit Crash,” which received almost no notice at all until The Economist magazine wrote about it in March. Six months after that, the deluge.

    What’s remarkable is how well Morris’ analysis of the crash, written before the crash, holds up half a decade after it. So when I saw that he was calling his newest book “Comeback,” I felt obliged to take a look.

    I’ll let him take it from here.

    Charles Morris: It’s the best-kept secret in the economics media: The United States is on the brink of a period of solid, long-term growth rivaling that of the 1950s and 1960s. It is not a finance-driven, self-destructive boom, like the 2000s’ housing bubble. No, the new economy will be durably grounded in energy and heavy manufacturing, even though it will take several years to come to full fruition.

    Evidence? Dow Chemical has commenced a $4 billion development in new plastics manufacturing in Texas, for example, that will start coming on stream in 2015 and be fully operational only in 2017, but it will be productive for a very long time. This will be a growth cycle with staying power.

    Why haven’t you heard about the boom? Official economic forecasters, like the International Monetary Fund and the Congressional Budget Office, simply have not factored America’s emerging new economy into their forecasts. Instead, they still see us limping along at an average of 2 to 2.5 percent real (after inflation) growth to the farthest horizon — a hobbled, aging power, borne down by debts and deficits, shorn of its old bounce-back vigor, tottering along just fast enough to stave off out-and-out stagnation.

    There is no question that the financial crash has left deep economic scars. But the fundamentals will turn in America’s favor and when they do, annual GDP growth should kick back up to at least the 3.3 percent average real growth rate that has prevailed since 1950. That’s far from a startling forecast for a recovery, but even at that level, the budget problems that have so paralyzed official Washington will shrink rapidly in the rear-view mirror as tax receipts grow, making debts and deficits shrink. The seemingly crushing post WWII debt — 120 percent of GDP — quickly dropped from the radar screens with growth in the 3-4 percent range in the 1950s. So what are the positive portents?”

    http://www.pbs.org/newshour/making-sense/comeback-why-the-us-sits-at-th-1/

  4. joyce says:

    In order to graduate from high school in Louisiana, students will soon be required to apply for federal financial aid for college.

    The state’s Board of Elementary and Secondary Education approved the new graduation prerequisite earlier this month, and the new policy will go into effect beginning with the class of 2018.

    The move makes the Pelican State the first in the country to require students to fill out the Free Application for Federal Student Aid, also known as the FAFSA, in order to receive a high school diploma.

    http://www.usnews.com/news/articles/2015-12-22/louisiana-to-require-students-to-fill-out-fafsa

  5. Juice Box says:

    Went to Nordstrom at 8 AM and then onto Best Buy. Shopping done in 1 hour and I did not get capped.

  6. leftwing says:

    LOL, I probably walked past you in the Mall. Arrived 7:52a, hit Bloomies at open at 8, Vineyard Vines at 8:20a, Godiva at 8:30a home before 9:00a.

    Fresh market for organic turkey and the fixins thereafter. Home again, two trades. Leaving soon for a quick trip to the City for another present on hold and lunch with an old friend, and then back here for church.

    Much more productive than I ever imagined.

    Merry Whatever You Celebrate everyone!!

  7. grim says:

    Need to brine two turkeys

  8. Ragnar says:

    I’ve been getting lots of compliments for the smoked turkeys I buy from smokehouse.com. This year I bought a Charles Henry Gray Party Ham from Smithfield for the first time. I hope it’s good.
    All I have to do is warm up the turkey and ham, and get the sides ready. And bake a cake and make ambrosia tonight.

  9. grim says:

    Been trying to find a local pig guy who can raise me some pigs on my spent bourbon mash. Bourbon-fed pigs sound pretty damn tasty to me.

  10. Nashville’s cool. I could easily do Belle Mead or Brentwood.

  11. yome says:

    #3
    Problem with his analogy is there is no demand to replace the massive $1.2 T dollar housing bubble.Retail is hurting.Salary is not going up fast enough. Where is this bubble going to come from to create demand? Price of oil has been down and the savings is not showing in the economy. Massive layoffs before the end of the year.

  12. yome says:

    #3
    Where is the money going to come from? Americans are living pay check to paycheck. Not to buy thing they want but to survive daily living. Rent and food.

    Most Americans have less than $1,000 in savings

    http://www.marketwatch.com/story/most-americans-have-less-than-1000-in-savings-2015-10-06?link=MW_popular

  13. anon (the good one) says:

    well, if lower the taxes of billionaires there will be more crumbs to trickle down

    yome says:
    December 24, 2015 at 12:10 pm
    #3
    Where is the money going to come from? Americans are living pay check to paycheck. Not to buy thing they want but to survive daily living. Rent and food.

    Most Americans have less than $1,000 in savings

  14. anon (the good one) says:

    what about legalizing child labor like in bolivia

    yome says:
    December 24, 2015 at 12:10 pm
    #3
    Where is the money going to come from? Americans are living pay check to paycheck. Not to buy thing they want but to survive daily living. Rent and food.

    Most Americans have less than $1,000 in savings

  15. yome says:

    Young Millennials reports 26.9% have more than $1,000
    Older Millennials 30% have more than $1,000
    Young GenX 31.4% have more than $1,000
    Older GenX 28.9% have more than $1,000
    Baby Boomers 29.6% have more than $1,000
    Seniors 31.9% have more than $1,000 + SS + retirement if not going to Med care part+ housing + Medication

    Where is the boom going to come from? Until I see my neighbor upgrading his home and buying a new car and going to vacation at the same time , no boom can match the $1.2T housing bubble

  16. Grim says:

    Seems fishy – how is savings account defined?

    I have no savings account – so technically I have zero in a savings account as a bank would define it.

  17. Grim says:

    At nearly zero interest, what’s the point of having either a checking or savings account outside short term cash requirements. You’d be an idiot to hold a big cash position.

  18. yome says:

    “How is savings defined?”

    They likely don’t have cash reserves to cover an emergency and will have to rely on credit, friends and family, or even their retirement accounts to cover unexpected expenses.”

  19. NJT says:

    #9 – The Spann farm in Washington, NJ. My son works there part-time. Mostly Angus but pigs, too.

    *Max Spann (senior) is also a real estate auctioneer.

  20. NJT says:

    #9 – a.k.a. – Heron Run Farm.

  21. grim says:

    You know you are in New Jersey when you read that as Heroin Run.

  22. grim says:

    Merry Christmas all

  23. Libturd at home says:

    Yes. Happy holidays ya’all.

  24. Comrade Nom Deplume, Two miles up says:

    Merry Christmas all, from slopeside at Breckenridge.

    See you in the new year.

  25. Libturd at home says:

    I miss Breckenridge. Haven’t been there in years. They used to have a crazy steep Poma to the peak. Do they still?

  26. Libturd at home says:

    I see they still got it. By far, the most challenging lift I’ve ever used.

  27. Had Chinese and saw The Big Short tonight. Jews know how to do Xmas.

  28. Essex says:

    that chick Marilyn is nuuuuuuuuts….

  29. anon (the good one) says:

    on Christmas I celebrated the birth of Jesus Christ, God’s only true Son

    Splat What Was He Thinking says:
    December 25, 2015 at 11:00 pm

    Had Chinese and saw The Big Short tonight. Jews know how to do Xmas.

  30. grim says:

    His lesser known son Vinny always seems to get the shaft.

  31. The Great Pumpkin says:

    The money will come from many areas. One, being growth in the economy as the author points out. Another is the transfer of wealth. Lots of wealth will be transferred in the next 10 years from individuals that are not in their “spending years” (baby boomers) to individuals that are (millennials). The money will be transferred by good jobs opening up as boomers retire and also through inheritance. Low energy costs are also rocket fuel for this next boom. These low costs for energy and commodities almost guarantee a boom will come in the 2020’s. You won’t see the impact immediately, but trust me, there will be an impact and it will almost certainly be inflationary.

    yome says:
    December 24, 2015 at 12:10 pm
    #3
    Where is the money going to come from? Americans are living pay check to paycheck. Not to buy thing they want but to survive daily living. Rent and food.

    Most Americans have less than $1,000 in savings

    http://www.marketwatch.com/story/most-americans-have-less-than-1000-in-savings-2015-10-06?link=MW_popular

  32. The Great Pumpkin says:

    Merry Christmas!

  33. The Great Pumpkin says:

    Give it some time. Labor market is tight…..massive layoffs? Give the u.s. energy market some time to get through the pain of cheap energy. It’s for the greater good of the economy. Could you imagine if gas was 3 or 4 dollars right now, that would kill so much momentum in the economy. Longer prices stay down, the more rocket fuel builds for the next boom.

    yome says:
    December 24, 2015 at 12:03 pm
    #3
    Problem with his analogy is there is no demand to replace the massive $1.2 T dollar housing bubble.Retail is hurting.Salary is not going up fast enough. Where is this bubble going to come from to create demand? Price of oil has been down and the savings is not showing in the economy. Massive layoffs before the end of the year.

  34. Not The Pumpkin says:

    Sorry Pumpkin, but a country as is right now, and as the plutocracy wants to make it (think Latin America) is going no where.

    There is one exception. If something happens and the frenemy pretense drops out with China. In this argument the Apples and other corporate out-sourcers find themselves overnight just being an US based corporate/design studio HQ, and all their so called manufacturing disappears, and they end up having to build from scratch massive manufacturing centers

  35. Essex says:

    36. Isn’t that mostly assembly? I’m not 100 sure that most Americans want to do work like that…but if given a choice? why not…

  36. Comrade Nom Deplume, Newspeak Editor says:

    [27] lib

    You answered so I won’t. Didn’t get out today cuz wife got wicked case of AMS for second year in a row. I get it but not as bad as her. So this will be our last trip to Breck.

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