New home sales rose to a seasonally adjusted 315,000 in November, the highest level since April, ad October sales were revised up by 3,000 to 310,000. But homebuilder stocks fell afterward. Clearly home sales are still at a very depressed level and it’s unclear whether today’s data indicates a sustained uptick, or more bouncing around the bottom. As John Ryding and Conrad DeQuadros of RDQ Economics wrote:
“It is too soon to declare that new home sales are recovering (especially with our misgivings over the construction of the data and the failure to amend the sales numbers for cancellations) but sales appear to have bottomed and the small gains over the last three months combined with the improvement in homebuilder sentiment over the same period is an encouraging development.��We look for a modest gain in new home sales and housing starts in 2012 despite the backlog of foreclosures.”
Lennar (LEN) fell 2.1% in midday trading. KB Home (KBH) was down 1.7%.
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