Is the New Home Market bi-polar?

The Daily Real Estate News, a publication of that well respected voice of the real estate industry carries reports from The Commerce Department (and others) that would seem to indicate a severe case of bi-polarized market behavior (or at lease of bi-polar public releases). A quick look back over the last 4-5 months shows how confusing these releases can be on the state of the real estate market. In this case I just looked at the articles which were released in the Daily Real Estate News about every 20-30 days concerning the state of new home starts, along with the learned projections of the so-called experts in the National Association of Home builders, among others.

Daily Real Estate News - March 16, 2011
New Home Construction Plunges in February

New-home construction in February dropped 22.5 percent from the previous month, the lowest in nearly two years and marking the second lowest level on record, the Commerce Department reports.

Builders broke ground on a seasonally adjusted 479,000 homes last month. Economists consider 1.2 million units a year a healthy building pace.


Daily Real Estate News - February 16, 2011
Housing Starts Jump 14.6% in January

Housing starts in January reached their highest rate in four months, increasing more than analysts expected the Commerce Department reports. Housing starts jumped 14.6 percent to a seasonally adjusted annual rate of 596,000 units

Daily Real Estate News - January 26, 2011
New Home Sales Surge

New single-family home sales in December rose to their highest level in eight months and prices were the highest since April 2008, raising cautious optimism for a housing market recovery.

The Commerce Department said sales jumped 17.5 percent to a seasonally adjusted 329,000 unit annual rate after a downwardly revised 280,000-unit pace in November. Economists polled by Reuters had forecast new home sales rising to a 300,000-unit pace in December from a previously reported 290,000 unit rate. Compared to December a year earlier, sales were down 7.6 percent. Overall 2010 sales dropped 14.4 percent to a 321,000-unit rate.

Daily Real Estate News - December 29, 2010
Housing Starts Predicted to Hit 3-Year High

Housing starts will probably reach a three-year high of 739,000 in 2011, creating about 500,000 jobs and helping trim the unemployment rate to 9.1 percent, said David Crowe, chief economist for the National Association of Home Builders, in an interview with Bloomberg.

Daily Real Estate News - November 29, 2010
New-Home Sales Slide

Blah, blah, blah…
Well you get the picture.

Is it any wonder that the public perception of the market is so confused – it’s up , it’s down, oops it’s back up again…no, no, no it’s down.

Of course the existing home market reports are just as confusing and just as bi-polar. It may well be that we are in the phase of the market that was predicted when we would bounce along the bottom for a while – up and down, up and down.

It would be a relief to get some sustained market movement in one direction or another, just for the reassurance of momentary consistency.