By Dr Denver H. Bubble
Going into January 2018 there was some optimism that new home sales nationwide would rally from December 2017 where they had been down 9.3%. January's new home sales were forecasted to be at 3.5%. In reality, January new home sales were down 7.8%. This is the lowest level since August 2017, even as the supply of homes rose from to 6.1 months from 5.5 months.
Sales in the Northeast were down the most at -33.3%, while our home region the West was up 1%.
The most likely culprit behind the nationwide decline is a surge in the interest rate that will either have an impact on sales or force prices to adjust lower. The days of this bubble are near the end.