Stocks are higher and Mortgage Bonds are lower to start the day.
New Home Sales, which measures signed contracts on new homes, were up 10.7% in May to a 696,000 annualized pace, which was above expectations. The report is actually stronger than it appears as there was a positive revision to the previous month. When factoring that in, sales are up 18% from the initially reported number. Year-over-year sales they are down 5.9%.
There were 444,000 homes for sale at the end of May, but only 37,000, or about 6% are actually completed. The rest are either not started or under construction.
The median home price remained steady at $449,000, which is up 15% year over year and points to an increase in higher-priced homes sold. The Average-priced home came in at $511,400, which is up 16% from last year.
The University of Michigan released its Consumer Sentiment Survey for the month of June, which came in at 50.0. This is the lowest on record dating back to 1978.
Next week is an important week for housing, with Pending Home Sales on Monday and fresh appreciation readings from Case Shiller and the FHFA on Tuesday. We’ll also be getting the Fed’s favorite measure of inflation, PCE.
Mortgage Bonds are trading in the middle of a wide range between support at 99.28 and overhead resistance at 100.60. Expect continued volatility while in this range. The 10-year is trading in a wide range of its own between support at 3.0% and resistance at 3.25%.
