The headlines are shrieking again, this time about the Commerce Department's report yesterday that new home sales in March were the lowest in sixteen years or so.  ABC News even opined (in the guise of reporting) that this report indicates that the housing market is getting worse. 

Wrong again, folks.

New homes are a different critter from resales.  Generally, the time from contract to closing is longer than in the case of resales.  Six to nine months is not unusual for new homes to take to close.  The mortgage crisis peaked in August 2007.  Contracts for all home sales in September and October were hit very hard, and the holiday season was much slower than had been expected because of the mortgage problem.  Resales from that period closed in December and January, really poor months in terms of numbers of sales.  New homes contracted in the gloomy period would just about now be closing because of the lag time.

Same pig, different python. (Still the mortgage pig, but the new homes python)

New homes will probably continue to be off from 2007 for the next several months as the 6-9 month period for new homes "gestation" continues to reflect earlier issues that seem to be improving as seen in resales numbers, certainly in Central New Jersey.

Hedge fund managers still influence the news as they peddle panic in real estate to sell more funds.  Will the media ever ask the right questions?