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Mixed Messages from the Housing Market Data

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  • Description

    OwnAmerica.com CEO Greg Rand on the outlook for the housing market.

  • Duration 3:55
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Home sweet home housing market look like it was shaping up right.

New home construction -- June jumped to its highest level since October 2008.

And confidence among homebuilders this month touched its best level in more than five years but.

The good times just couldn't -- today new home sales dropped eight point 4% from.

I'd month -- so what does all this back and forth really mean here with means great ran.

Own America dot com CEO he's gonna French.

Great sorted out -- getting.

He's sick from the back and forth in the housing -- It's okay what new home sales remember war measuring -- these are new construction probably built over the last six to nine months that it just sold and we're not really measuring the overall housing market then because that's only about 6% of all the houses that are actually for sale right now so you can see him.

Roller coaster ride when it comes to new home sales largely tied to supply.

Being tight and that's kind of indicator of developers builders who have a -- literally one year threshold they want -- see -- home sales a year from now going to be strong.

It didn't start breaking ground to build a house today so you can get.

Fooled -- -- by watching the ups and downs of new home sales and try to extrapolate at an overall trend from that.

Well one of the positive numbers that we got earlier this week was new construction and housing starts like you said I mean that was a positive numbers so that means like you were saying a year from now we're gonna have some positive numbers -- whereas.

It's you know -- -- is being like seven to nine months so -- 79 months you'll see an increase in home sales new home sales that is.

The the interesting thing is the fact that -- you know.

Builders are a unique kind of investor right -- -- the land they do the improvements on the land build a house and sell it.

They are a business to business players are not looking to move into the thanks so.

Whenever you see starts going up.

That's builders having confidence in something good down the road within a year to eighteen months and overall investors buy and hold investors those are the ones who wore.

Really active right now and they have a five or nine year.

Threshold so they have -- confidence and overall recovery recovery which we all do the question is when it begins and we're sort of finding a way they're now I think.

Well the folks from zillow you know -- home prices they -- they felt like we put in Nevada and do you agree with that.

Well those guys have a way of wanted to measure like yesterday compared to today okay it's almost like looking at intraday trading on the stock in trying to see a trend I mean for example yesterday they before.

A stack came out that Phoenix was up 12% rate but we know that supplies tight in Phoenix because foreclosures have been log -- because of government interference.

Now if you know that these supplies -- you know the 12% increase in prices probably artificial.

So we have yet to get to stay away back -- -- their way back seat he had information I am more confused than we started segment two minutes ago Phillips and we back and tell me.

Is getting better or executing works we are finding the bottom okay which means that -- you're seeing buyer demand percolate -- home sales this year.

Are going to be higher than last two years without a doubt.

I see that from the field right now so.

You're seeing demand begin to put some upward pressure on prices you're gonna have a shadow inventory causing problems in the near term -- -- see a lot of you know the economy is not recovering yet.

And the housing market doesn't recover until the economy recovers having said that if the prices come down far enough and they pretty much have.

Give or take a point here or there.

You're seeing demand begin to catch up and again the most critical element of the demand right now.

Our folks who are betting their money on this not not moving to the houses.

But acquiring them to rent them out and they're acting feverishly which gives you an indication that there's a big segment of the investing public who sees a recovery in -- And that's contagious.

-- both short answer to a long question is we're finding the bottom now into next year it's boring it takes time but we're gonna see a period of stability.

When the market begins to bottom out for years until an overall recovery I like that it's -- -- an end it right there because I understood that last part I liked it.

Let's just leave it there thanks for coming on -- that I.

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