Uptick in Home Sales Gets Top Billing Over Price Plunge

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BREAKING NEWS
May 24, 2007
Sales of New U.S. Homes Surged in April
Biggest gain in 14 years as median prices fell by record amount
WASHINGTON - Sales of new homes surged in April by the biggest amount in 14 years, but the median price of a new home dropped by the largest amount on record. The mixed signals left no clear picture of whether the worst of the nation’s housing slump is over.

The Commerce Department reported that sales of new single-family homes jumped by 16.2 percent in April to a seasonally adjusted annual rate of 981,000 units. That was far better than the tiny 0.2 percent gain that economists had been expecting.

However, the median price of a new home sold last month fell to $229,100, a record 11.1 percent decline from the previous month. The big price decline indicated that builders are slashing prices in an effort to move a huge overhang of unsold homes.
Associated Press

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Uptick in Home Sales Gets Top Billing Over Price Plunge

Category: NEWS

By: Pete Kendall, May 24, 2007

In real estate, the forces of reversal have overwhelmed the forces of continuance. The optimism that fostered liquidity creation for property speculation has turned to caution. Crashes do not typically occur in straight lines. Even they have a structure, with periods of bounce and recovery. Each positive sign will probably be taken as the bottom.
The Elliott Wave Theorist, February 2007

burning down the house I saw an earlier headline that said that home sales had biggest gain. I didn't look further at the time, however I was puzzled. Then I saw this article and it made more sense. It's like a 'Crazy Eddie's' commercial...they're slashing prices to move 'em out. 'Their prices are INSANE!' Bottom line: Values are continuing to plummet.
--Eugene Fina

Here’s another headline that appeared today on MarketWatch.com:
Subprime Mortgage Stocks Jump
Comments from Countrywide, HSBC Suggest Worst May Be Over

As the quote at the top of the page from The Elliott Wave Theorist in February anticipated, every upbeat news item is being extrapolated into a sure sign that the coast is clear. Some homeowners are buying the dip, but the decline is the real news here. If prices were anywhere near a bottom, a record high decline would be the headline, and a one-month upward blip would be treated as an afterthought.

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