Tue. Oct 26th, 2021

New home sales in the United States exceeded expectations and added 1% in July, supporting the short-term risk momentum and further pushing the S & P500 index into the highs zone. historical close to 4500.

However, the long-term chart shows that new construction sales in the United States have returned to a long-term upward trend in 2021 after a 2020 rebound.

The boom in the US real estate market was short-lived in terms of volume, but not prices, which continue to update highs. Presumably, this price jump makes people hesitate to buy new homes, the average price of which exceeded 390,000 in July (+ 18.4% year-on-year).

Home sales statistics again highlighted inflationary trends in the US caused by the disruption in the supply of certain commodities. But it is not easy to distinguish a housing boom as in the 2000s. The same applies to the 40% increase in used vehicles due to the scarcity of semiconductors. Rising rates will tighten conditions for buyers and risk collapsing demand, but it is unlikely to lower prices.

He FxPro Team of analysts

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