There's lots of stagflation in the new home market. During April, new home sales (registered when contracts are signed) dropped 16.6% m/m and the months' supply of new homes jumped to 9.0 from 6.9 in March. Here's more:
(1) The m/m sales declines were widespread in the South (-19.8%), Midwest (-15.1), West (-13.8), and Northeast (-5.9).
(2) The median price of a new home rose 19.6% y/y to a record $450,600. It is up 45.3% over the past 24 months, while the average price is up 58.3% over the same period!
(3) Those incredible price increases are partly attributable to fewer sales of lower-priced homes. In addition, the final demand PPI for construction was up almost 20% y/y during April.
(4) The Fed has increased the federal funds rate by only 75bps so far this year, but a combination of soaring home prices and rapidly rising mortgage rates have slammed the affordability of buying a home.