by Calculated Risk on 3/26/2007 11:15:00 AM

Please don't miss Tanta's post this morning: Unwinding the Fraud for Bubbles

For more graphs, please see my earlier post: February New Home Sales: 848 Thousand

Click on graph for larger image.

The first graph shows New Home Sales vs. Recession for the last 35 years. New Home sales were falling prior to every recession, with the exception of the business investment led recession of 2001. This should raise concerns about a possible consumer led recession in the months ahead.


The second graph shows Not Seasonally Adjusted (NSA) New Home Sales for February.

Sales have fallen back close to the levels of '96 and '97.


The third graph shows monthly NSA New Home sales. This provides a different prospective of the housing bust.

NOTE: For existing home sales, February is typically a very weak month. However, for New Home sales, February marks the beginning of the spring selling season. This is because New Home sales are reported when the contract is signed - and buyers are hoping to move during the summer. Existing home sales are reported at the close of escrow - so the early summer months are usually the strongest months of the year.

March is typically the strongest month of the year for New Home sales. And this graph shows that 2007 is starting to shape up like 1982 with no surge in spring sales.