The New Home Market Will Not Help Us

I read a story last week written by Robert Dietz, chief economist for the National Association of Home Builders or NAHB. Robert discovered that sales of new homes built to be sold to an owner occupant or second home buyer currently outpace the number of new home starts for owner occupants and second home buyers. There are more home starts happening, but many of those homes are being sold to investors big and small. And starts should outpace sales for a "balanced" market.

Thus, I fully expect that new home prices will start soaring as demand is out-stripping supply. Second, don't expect extra new housing inventory to replace our lack of existing homes for sale, which means existing home prices will continue to soar.