![](https://www.openenterprisenews.com/wp-content/uploads/2018/04/sorry-image-not-available.jpg)
Image Source: UnsplashThe homebuilders’ inventory of started but unsold homes is steeply rising as sales drop. It will take price cuts to clear inventory.
Data from the census department, chart by MishNew Residential ConstructionYesterday, the Census Department released the New Residential Construction report for June.
Note the margins of error in this report, ~15 percent.New Homes For Sale By Stage of ConstructionAllegedly there are 476,000 homes for sale at a seasonally-adjusted annualized rate (SAAR).However, 100,000 of them have not been started and perhaps won’t for years.There are 376,000 homes that have been started, of which 102,000 have been completed. It’s the most since the middle of the great recession.Started and completed homes are much more of a commitment than holding vacant land, and it’s happening just as the economy is slowing rapidly.New Home Sales Drop SlightlyYesterday, I reported New Home Sales Drop Slightly, Economists Expected a 3.4 Percent RiseNew Home Sales Since 1963
New home sales are well below the February 1964 report (yellow highlights).Who can afford homes? Prices are at record levels and mortgage rates are 6.90 percent according to Mortgage News Daily.Existing Home Sales Drop 5.4 Percent But Median Price Hits New RecordOn July 23, I noted Existing Home Sales Drop 5.4 Percent But Median Price Hits New Record
Existing-home sales declined 5.4 percent in June. It was the 23rd decline in 29 months. But the median price hit a new record.
Not that anyone needed more evidence, but that’s another sign of Fed bubble-blowing prowess.Signs of Severe Credit Card and Auto Loan Stress in Generation ZThe people who most want to buy a house, can’t because they can neither afford a house nor the rent they are paying.That has been an explicit theme of mine since February.The economy is slowing and that will hit the zoomers first and the hardest, especially renters. This will have a huge election impact.I tie the economics and politics together in my post Signs of Severe Credit Card and Auto Loan Stress in Generation ZMore By This Author:The Yield Curve Is About To Uninvert, Is That A Recession Indicator?
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