Housing Has Legs

Surprisingly strong housing numbers out this morning: new single-family homes rose 16.6% in April to an annual pace of 616,000 (see chart below), well above expectations, and up 23.8% over the past year. Supply of new homes fell to just 4.7 months, all due to faster sales (inventories were flat). Sales are up strongly in the Northeast, solidly in the South and West, although down in the Midwest. The median ($321,100) and average ($379,800) prices jumped 9.7% and 13.5%, respectively, the last year.

There is more to come. The graph below shows the data from 1963. We may never reach the 2005 peak of 1.328 million (or, maybe we will), but housing will continue to strengthen because job growth and wages are rising, and home ownership is still low. Housing has legs.

• 2 Jun, 2020

  Earthrise or Earthset: Thoughts on a Post-Pandemic World (Part 3)

  Source: NASAWeak economic growth and low investment returns are the prospects we discussed in the first two parts of ...

• 29 Jun, 2017

  Humans! What Are They Good For?

  It looks like the world is turning against humans. Ive talked before about the rise of robots in manufacturing (2016 ...

• 19 Nov, 2015

  Fairy Tales

  The technology bubble of the late 1990s is a distant memory for most investors, and an ignorance for the rest. But back ...