New home sales print at 288,000, missing expectations of 295,000, and coming at the third lowest number in history. The previous read of 276K was revised to 288K. New home inventory is now at 8.6 month supply. Add the roughly 12 months in supply at existing home sales in inventory and you can easily see why the stock market is up almost 2.0%. The median home price of $204,700 is now the lowest since December 2003.
The 288 thousand annual sales rate for August is just above the all time record low in May (282 thousand). This was another very weak report. New home sales are important for the economy and jobs - and this indicates that residential investment will be a sharp drag on GDP in Q3.
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