What Recovery? U.S. Homes Sales Plunge To Lowest On Record: Expected

In the last few months the media was keenly publicizing how the new homes sales in the U.S. were strong and so on, while all along we knew it was due to the home tax credit.

New homes actually fell in May to the lowest level on record, collapsing 33% from April. The Commerce Department Data had not been this bad since 1963. In addition, the demand that was published in prior months was also revised down.

All U.S. regions saw drops and the supply of homes at the current sales rate jumped to 8.5 months’ worth from 5.8 months in April.

Bloomberg reports that the data "confirms the market is stumbling. Sales of existing homes, housing starts, building permits, builder confidence and mortgage applications have all declined.
The S&P Supercomposite Homebuilder index, which includes Toll Brothers Inc. and Lennar Corp., has dropped 28 percent through yesterday since reaching a 19-month high on May 3. The broader S&P 500 Index is down 10 percent from April 23’s 19- month peak".