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Is the housing market finally turning around?

Yesterday the Commerce Department reported that new home sales rose 11 percent to an adjusted annual rate of 384 thousand units per year. With prices still falling, sales have now risen for three months in a row to their highest level since November.

Now, November was no great shakes. But now the data is headed up, not down like before. And while national new home sales don’t even add up to half of the total foreclosure activity in California, it’s striking that anyone is buying a new home at all with all the foreclosed homes on the market. Remember, new home sales are a leading indicator; foreclosure activity is a lagging indicator.

And housing activity precedes increases in home prices. So what do we see? Another link in a long chain of indicators that show that the economy is beginning to turn up. Not dramatically, and not without some bumps. But the direction is upwards.

And that, my friends, is encouraging.

Douglas R. Tengdin, CFA
Chief Investment Officer
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By | 2014-09-05T13:13:19+00:00 July 28th, 2009|Global Market Update|0 Comments

About the Author:

Mr. Tengdin is the Chief Investment Officer at Charter Trust Company and author of “The Global Market Update”. The audio version of each post can be heard on radio stations throughout New England every weekday. Mr. Tengdin graduated from Dartmouth College, Magna Cum Laude. He received his Master of Arts from Trinity Divinity School, Magna Cum Laude and received his Chartered Financial Analyst (CFA) designation in 1992. Mr. Tengdin has been managing investment portfolios for over 30 years, working for Bank of Boston, State Street Global Advisors, Citibank – Tunisia, and Banknorth Group. Throughout his career, Mr. Tengdin has emphasized helping clients manage their financial risks in difficult environments where they can profit from investing in diverse assets in diverse settings. –
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