NEW YORK - new single-family home sales in the United States rose unexpectedly in April to check their second straight month of gains and increased prices, according to a Government report Tuesday that offered some hope for the stagnant housing market.
RICHMOND FED:
The key POINTS: * the Ministry of Commerce said sales increased by 7.3% to a seasonally adjusted annual rate of 323,000 unit, the highest level since December, a slightly upward revised collection-unit pace in March. * Economists surveyed by Reuters had expected unchanged sales at a speed of 300 000 units previously reported. All four areas registration of sales, with the West gains reported an increase of 15.1%. * However, from last April, sales have decreased by 23.1%. * The Richmond Federal Reserve, said that its composite index fell to-6 in May of + 10 in April.
COMMENTS:
RICHARD DEKASER, ECONOMIST, THE PARTHENON GROUP, BOSTON
"It is a positive surprise." Sales activity continues to bounce off the bottom. There is no evidence of a second run down housing, but there is no convincing evidence of a rebound. This significantly alter the behavior of lenders.
"The inventory of homes is rare extreme levels in the context of a glut of existing homes." It is augured well for the activity future construction. When this happens? It is already the case, but you need a microscope to discern. ?
DAVID ADER, SENIOR GOVERNMENT BOND STRATEGIST, CRT CAPITAL GROUP, STAMFORD, CONNECTICUT:
"One greater than the gain expected sales and a price gain (compared to three months before negative numbers) therefore a more firm, if volatile, report."
"Richmond Fed, with all due respect, is not really followed many, but is a may figure and the weakness is remarkable and widespread." The Richmond Fed figure who has at least a correlation of 78 percent with ISM. ?
MICHAEL GAPEN, SENIOR ECONOMIST AMERICAN, BARCLAYS CAPITAL, NEW YORK, NEW YORK:
"It was certainly a report better than expected, but at the same time, I am reluctant to read too inside." Total sales remain well below their healthy levels of longer term, but nevertheless, it is above the average rate of k 286 observed in the first quarter.
"Lower activity in sales of homes early in the first quarter was largely due to adverse weather conditions as it is logical that we are witnessing an escalation of these levels.". Another positive is the supply of homes fell. If the month down to 4 months which would be levels of before the crisis, therefore, even at the low level of sales, inventory is very lean and thus at some point builders will emerge and begin to build once more.
MICHAEL YOSHIKAMI, PRESIDENT AND CHIEF INVESTMENT STRATEGIST AT ADVISORS IN WALNUT CREEK, CALIFORNIA YCMNET
"I do not think there is much to do that.". There is still a huge overhang on the housing market, and then the sales begin to filter, which does not change the fact that we have still such huge inventory. But since the number was about expectations, investors will focus on other issues such as Europe or new businesses. ?
GARY THAYER, CHIEF MACRO STRATEGIST, WELLS FARGO ADVISORS, ST. LOUIS, MISSOURI:
"It is a good number, better than expected." Perhaps, he suggests that we begin to see some signs of stabilization in housing, but it is too early to say that we have bottomed out. We still have many existing homes for sale and this excess inventory is likely to hang on the new domestic market for the most part of a year. And a sense of Home Builder remains very negative. It will not succeed as if manufacturers feel that we turned the corner yet. ?
PIERRE ELLIS, SENIOR ECONOMIST DECISION ECONOMICS, NEW YORK:
"Sales were stronger than expected, but that does not say much, given that the level is still low." But it is encouraging in the sense that it was large scale between regions and he fired the inventory of houses down. ?
PATRICK NEWPORT, ECONOMIST, IHS GLOBAL INSIGHT, LEXINGTON, MASSACHUSETTS:
"The note of caution is that this version tends to be volatile." The number is still valid, but it is flat on the bottom. Manufacturers are having fewer problems selling their property. ?
"It is too early to say that we are at a turning point for housing." You have to wait three to four months of positive months until you can say things are getting better. ?
LINDSEY PIEGZA, ECONOMIST, FTN FINANCIAL, NEW YORK
"We beat consensus, which is certainly a positive spin to this report.". However, if you look at a chart of sales we really not have acquired any ground since the end of 2009. We are not losing any ground here, but we have no positive progress.
"Demand is still warm." Consumers still are struggling to make their monthly payments. We are always dealing with the same negative overhangs, that we have been dealing with for some time.
"Market really does read in housing as it used to because it does not mean that it was in terms of the economy and supplementing income." Unless we have seen a very significant improvement in the trend or decrease in trend I think market continues to respond to a report of housing. ?
VIMOMBI NSHOM, ECONOMIST, ECONOMICS IFR, A THOMSON REUTERS UNIT:
"New sales of houses, just as any other indicator of housing, has been a ride roller coaster for 2011 - rising in the last two months after having dropped in the two forward." Alternating patter will probably persist for the rest of the year.
"All regions have experienced gains sales contributes to lowering the number of new homes available at the purchase of 175 k - a record low - and the houses down almost 10% and 6.5% months supply." The breakdown of stock is a double edge sword as the lightest stock means sales are correcting arrears, but the low number shows also the damage still prevalent on the given market adversity builders' to build homes, that no one will buy - especially given the premium prices on homes previously owned. ?
REACTION of the market: the STOCKS: U.S. stock indices trimmed gains obligations: the United States binding prices slipped modestly FOREX: dollar maintained gains against the yen
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