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New Homes Sales & Durable Goods

October 28th, 2009 Michael McDonough

September’s new home sales came in at a disappointing seasonally adjusted annual rate of 402K units, compared to a revised pace of 417K a month prior.  In September the supply of new homes remained stable at 7.5 months. The median new home price increased by 2.5% to $204,800.  The reason for the decline can likely be attributed to a grouping of factors that include rising mortgage rates, weak labor market, and the waning effects of the first time home buyer tax credit set for expiration at the end of November–this will however likely be extended.

In other news, September’s durable goods orders rose 1.0% inline with the Bloomberg consensus estimate.  A rise in orders for defense aircraft more than offset a decline for civilian aircraft.  Overall this release continues to indicate the economy is in the midst of a modest recovery.

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