Yesterday, I pointed out the report from the National Association of Realtors about housing sales hitting a 10-year low. That’s bad news for sure, and I reported it to you without looking at the underlying numbers.
I owe you an apology for that. It turns out that there are a lot of really positive numbers in that report which are not being reported. This was brought to my attention by a particularly brilliant analyst, Larry Kudlow of CNBC.
Some of the things Kudlow points out:
- “The median existing home price has increased four consecutive months and is up 10 percent since February (median price was $215,000 in June versus $196,000 last winter)”
- “Existing home sales in the western region (one of the hardest hit areas) are up four straight months, and are 17 percent above the low in October. At the same time, prices in the West have increased three straight months.”
- “Overall national existing home sales are basically stabilizing at just under five million. And in the first and second quarters of 2008, these sales dropped slightly by 3 percent in each case, which is a whole lot better than the roughly 30 percent sales drops of the prior three quarters”
Stabilization. That’s what matters right now. The market has to be stable again before there can be a move upward. And while the recent NAR report shows that while there is still decline in the market, that decline is now happening in fewer places and at much slower pace. And there are now several regions of the country that are actually flat or slightly improving.
That, my friend, suggests stabilization is under way.