New home inventories drop below 200k, but still represent 8+ months of supply
Posted By:
Tom Sanderson
Date Posted:
Wednesday, December 29, 2010
8:00 AM
Seasonally adjusted new home inventory fell to 8.2 months of supply in November from 8.8 months in October. The absolute inventory of new homes continues to fall and is now at 197 thousand, the lowest level seen since the late 1960's, and the first month to drop below 200k. Any recovery in the rate of sales would quickly deplete the low absolute inventory level and lead to a significant increase in housing starts (and freight) but that does not appear likely in the near term. The vertical bars in the graphs represent recessions.
