This morning at the Associated Press, aka the Administration's Press, Martin Crutsinger reacted predictably to the Census Bureau's January new home sales release by commenting primarily on the forest while mostly ignoring the widely divergent health of the trees. Though he compared January to December for the country's four regions, he failed to note that three of them reported the same or fewer sales than January 2013.
This caused him to spin an unsupportable assessment of today's news as "offering hopes that housing could be regaining momentum after a slowdown last year caused by rising interest rates." Maybe in the South, Marty, but nowhere else. Several paragraphs from Crutsinger's report, followed by a regional breakdowns, are after the jump.
First, the excerpts:
US SALES OF NEW HOMES UP IN JANUARY
U.S. sales of new homes rebounded in January to the fastest pace in more than five years, offering hopes that housing could be regaining momentum after a slowdown last year caused by rising interest rates.
Sales of new homes increased 9.6 percent in January to a seasonally adjusted annual rate of 468,000, the Commerce Department reported Wednesday. That was the fastest pace since July 2008.
The rise came as a surprise to economists who had been forecasting a sales drop in January, in part because of a belief that activity would be held back by bad winter storms in many parts of the country.
Sales had fallen 3.8 percent in December and 1.8 percent in November, leading to worries that the housing recovery could be losing momentum.
The big January gain was likely to ease those concerns. Many economists believe sales of both new and previously occupied homes will rise in 2014, helped by an improving economy and job gains which will boost the number of people working.
... The sales gain was led by a 73.7 percent surge in sales in the Northeast. Sales were up 11 percent in the West and 10.4 percent in the South. The only region to see a sales decline was the Midwest where sales fell 17.2 percent, likely a reflection of winter blizzards that hit the region.
Sales for all of 2013 rose to 428,000, the highest point in five years and an increase of 16.3 percent from 2012.
Economists expect sales to grow more in 2014 although they do not expect the gain to be as robust as the 2013 increase.
Here are the raw numbers of homes in January in the four different regions and in the entire country, along with December and January seasonally adjusted figures by region:
Readers can see that the only example of meaningful year-over-year improvement came in the South. The South's share of new home sales was 59 percent, the highest percentage in the nine Januarys listed. Two of the other regions (Midwest and West) came in well below January 2013. Sales in the Northeast merely held steady. The South also accounted for about 63 percent of the seasonally adjusted annualized improvement from December to January (26,000 out of 41,000).
I should also note that the much of the South was virtually shut down for several days by the winter storms which arrived in the final days of the month, or its dominance may have been ever more pronounced.
Crutsinger's central premise that "housing could be regaining momentum" falls apart in every region but the South, which is the only region which can be described as "robust." The South is also the only region where annualized sales are above where they were in mid-2008. The Northeast and the West are both below where they were in June of last year. The Midwest is almost one-third below where it was in May 2013.
President Obama should be thanking the South for making the housing market's January 2014 performance rise to the level of mediocrity.
Not coincidentally, the South is dominated by relatively conservative GOP governors and legislatures. If it weren't for the South, Crutsinger would have been reporting on weak overall results today. He should have noted that.
Cross-posted at BizzyBlog.com.
