April’s durable goods, new home sales, and existing home sales.

The widely watched reports that were released this week included the April advance report on durable goods and the April report on new home sales, both from the Census bureau, and the Existing Home Sales Report for April from the National Association of Realtors….this week also saw the release of Chicago Fed National Activity Index for March, a weighted composite index of 85 different economic metrics, which rose to +0.34 in April from +0.32 in March, after the March index was revised up from the +0.10 reported last month…as a result, the 3 month average of that index rose to +46 in April, up from +23 in March, which indicates that national economic activity has been above the historical trend over recent months…

Two more regional Fed manufacturing surveys for May were also released this week: the Richmond Fed Survey of Manufacturing Activity, covering an area that includes Virginia, Maryland, the Carolinas, the District of Columbia and West Virginia, reported its broadest composite index rose to +16, following last month’s plunge from +15 to -3, indicating a resumption of growth in that region’s manufacturing, while the Kansas City Fed manufacturing survey for April, covering western Missouri, Colorado, Kansas, Nebraska, Oklahoma, Wyoming and northern New Mexico, reported its broadest composite index rose to +26 in May, up from + 17 in April, indicating a somewhat more widespread growth among that region’s manufacturers…

April Durable Goods: New Orders Down 1.7%, Shipments Down 0.1%, Inventories Up 0.3%

The Advance Report on Durable Goods Manufacturers’ Shipments, Inventories and Orders for April (pdf) from the Census Bureau reported that the widely watched new orders for manufactured durable goods fell by $4.2 billion or 1.7 percent from March to $248.5 billion in April, their first decrease in three months…durable goods orders for March were revised to show a 2.7% increase to $252.7 billion, revised from the 2.6% increase to $254.9 billion reported a month ago, as there was an intervening benchmark revision on May 17th that revised all previously published factory data back to 2002…as is usually the case, the volatile monthly change in April’s new orders for transportation equipment caused this month’s headline change, as April transportation equipment orders fell $5.6 billion or 6.1 percent to $87.1 billion, on a 29.0% decrease to $16,228 million in new orders for commercial aircraft….excluding new orders for transportation equipment, other new orders were up 0.9% in April, while new orders for nondefense capital goods excluding aircraft, a proxy for equipment investment, were up 1.0% to $67,275 million…

The seasonally adjusted value of April’s shipments of durable goods, which will ultimately be inputs into various components of 2nd quarter GDP after adjusting for changes in prices, fell by $0.1 billion or less than 0.1 percent to $246.7 billion, after March shipments were revised from a increase of 0.3% to a increase of 0.7%…again, shipments of transportation equipment were responsible for the change, as they fell $1.8 billion or 2.1 percent to $82.8 billion, as the value of shipments of commercial aircraft fell 27.1% to $10,880 million…excluding that volatile sector, the value of other shipments of durable goods rose 1.0%, and are 7.9% higher year to date than a year ago….meanwhile, the value of seasonally adjusted inventories of durable goods, also a major GDP contributor, rose for the 17th time in 18 months, increasing by $1.2 billion or 0.3 percent to $401.7 billion, after the value of March inventories was revised from $411.0 billion to $400.5 billion, now a 0.2% increase from February…

Finally, unfilled orders for manufactured durable goods, which are probably a better measure of industry conditions than the widely watched but volatile new orders, rose for the fifth time in six months, increasing by $5.5 billion or 0.5 percent to $1,153.4 billion, following a March figure which was revised from the $1,154.0 billion reported last month to $1,147.8 billion, still an 0.8% increase from the revised February figure…a $4.2 billion or 0.5 percent increase to $796.2 billion in unfilled orders for transportation equipment was responsible for more than three-fourths of the aggregate increase, even as unfilled orders excluding transportation equipment rose 0.4% to $357,181 million….compared to a year ago, the unfilled order book for durable goods is 3.7% higher than the level of last April, with unfilled orders for transportation equipment 3.2% above their year ago level, on a 6.2% increase in the backlog of orders for motor vehicles and a 4.1% increase in the backlog of orders for commercial aircraft…

New Home Sales Fell in April After Prior Month’s Sales were Revised Lower

The Census report on New Residential Sales for March (pdf) estimated that new single family homes were selling at a seasonally adjusted pace of 662,000 homes annually during the month, which was 1.5 percent (±11.8 percent)* below the revised March annual rate of 672,000 new home sales, but still 11.6 percent (±23.7 percent)* above the estimated annual rate that new homes were selling at in April of last year….the asterisks indicate that based on their small sampling, Census could not tell whether April new home sales rose or fell from those in March or from those in April a year ago, with the figures in parenthesis representing the 90% confidence range for reported data in this report, which has the largest margin of error and is subject to the largest revisions of any census construction series….with this report; sales of new single family homes in March were revised from the annual rate of 694,000 reported last month to an annual rate of 672,000, while sales in February, initially reported at an annual rate of 618,000 and revised to a 667,000 rate last month, were revised to an annual rate of 659,000, and while new home sales in January, initially reported at an annual rate of 593,000 and revised from a 622,000 rate to a 644,000 rate last month, were revised to a 633,000 a year rate with this release…

The annual rates of sales reported here are seasonally adjusted and extrapolated from the estimates of canvassing Census field reps, which indicated that approximately 64,000 new single family homes sold in April, down from the estimated 65,000 new homes that sold in March but up from the 54,000 new homes that sold in February and from the 48,000 that sold in January….the raw numbers from Census field agents further estimated that the median sales price of new houses sold in April was $312,400, down from the median sale price of $335,400 in March but up from the median sales price of $311,100 in April a year ago, while the average new home sales price was at $407,300 , up from the $366,000 average sales price in March, and up from the average sales price of $365,800 in April a year ago….a seasonally adjusted estimate of 300,000 new single family houses remained for sale at the end of April, which represents a 5.4 month supply at the April sales rate, up from the revised 5.3 months of new home supply now reported for March…

for graphs and additional commentary on this report, see the following two posts by Bill McBride at Calculated Risk: New Home Sales decrease to 662,000 Annual Rate in April and A few Comments on April New Home Sales

Existing Home Sales 2.5% Lower in April, Down 1.4% Year over Year

The National Association of Realtors (NAR) reported that seasonally adjusted existing home sales fell by 2.5% from March to April, projecting that 5.46 million existing homes would sell over an entire year if the April home sales pace were extrapolated over that year, a pace that was also 1.4% below the annual sales rate projected in April of a year ago….the NAR also reported that the median sales price for all existing-home types was $257,900 in April, 5.7% higher than in April a year earlier, which they report as “the 74th straight month of year-over-year gains“…..the NAR press release, which is titled “Existing-Home Sales Slide 2.5 Percent in April“, is in easy to read plain English, so if you’re interested in the details on housing inventories, cash sales, distressed sales, first time home buyers, etc., you can easily read about them in that press release…as sales of existing properties do not add to our national output, neither these home sales nor the prices for which these homes sell are included in GDP, except insofar as real estate, local government and banking services are rendered during the selling process…

Since this report is entirely seasonally adjusted and at a not very informative annual rate, we usually look at the raw data overview (pdf) to see what actually happened during the month…this unadjusted data indicates that roughly 460,000 homes sold in April, up 6.0% from the 434,000 homes that sold in March, and up by 2.9% from the 470,000 homes that sold in April of last year, so we can see that it was only the seasonal adjustment that showed the sales decrease, possibly an aberration due to the unusually cool weather nationally…that same pdf indicates that the median home selling price for all housing types rose by 3.2%, from a revised $236,600 in March to $257,900 in April, while the average home sales price rose 2.6% to $297,300, from the $289,900 average sales price in March, while it was up 3.3% from the $287,800 average April home sales price of a year ago…again, for both seasonally adjusted and unadjusted graphs and additional commentary on this report, see the following two posts from Bill McBride at Calculated Risk: NAR: “Existing-Home Sales Slide 2.5 Percent in April” and A Few Comments on April Existing Home Sales

 

(the above is the synopsis that accompanied my regular sunday morning links emailing, which in turn was mostly selected from my weekly blog post on the global glass onion…if you’d be interested in receiving my weekly emailing of selected links, most picked from the aforementioned GGO posts, contact me…)   

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