With home sales weakening across the nation (while mean home prices are surging relative to median, signaling higher-end homes dominating the sales) and homebuilder sentiment slumping, this morning’s Case-Shiller (newly minted S&P CoreLogic CS) home price index data unexpectedly accelerated even higher.
Following the disappointing tumble in existing home sales (to 2 year lows), analysts expect a modest drop in new home sales in May of just 0.2% MoM (after April’s 16.6% MoM plunge). Instead, new home sales spiked 10.7% MoM (from an updwardly revised -12% MoM print in April) – despite soaring mortgage rates…
A little over a month ago, when mortgage rates were still “only” 5% we shared several devastating anecdotes from real estate agents and industry execs who validated our worst fears: US housing was imploding… fast, with subsequent observations only confirming this dire conclusion about the state of the most popular asset class among the US middle class.
Mortgage costs are the most expensive in years as the Federal Reserve embarks on aggressive quantitative tightening, implying that the souring macroeconomic climate may not support extraordinary home price growth for much longer as the national inventory of homes increases for the first time in years, according to Realtor.com data.