By Dr Denver H. Bubble
New home sales were expected to bounce back from the January 2018 decline of 7.8% but dropped 0.6% in February 2018. This is the first time that new home sales have declined for three straight months since the first quarter of 2014. Looking at the regional breakdown it was a mixed bag with new home purchases rising in two regions and declining in two regions. Sales fell 17.6% in our home region the West. National median sales price continued to increase, rising 9.7% year-over-year to $326,800.
Bloomberg suggested that steady hiring and low employment combined with high consumer confidence will support demand for housing, however, mortgage borrowing costs continue to rise with another Federal Reserve rate hiking this week and housing price appreciation growing faster than wage growth. These factors will continue to impact affordability for millennial and first-time buyer putting pressure on the housing bubble that has developed