by Wolf Richter, Wolf Street:
Making deals where the buyers are. And the buyers are at lower price points.
It’s homeowners and the pros – the homebuilders. Yesterday, we got data on sales by homeowners: Despite plunging mortgage rates and ample inventory, sales fell for the 16th month in a row, but prices rose to a new record. After surging 52% in seven years, prices are too high and are hitting demand. Today, we got data on sales of new houses by homebuilders: They’ve chopped their prices to the lowest levels in years to prop up sales, as they’re loaded with inventory that they have to sell because that’s how they make their living.