The ever optimistic economists in the Econoday survey expected a huge rebound in new home sales in January from 535,000 units to 576,000 units SAAR (seasonally adjusted annualized rate).
Instead of the expected 41,000 increase in units, sales rose by 20,000 units.
New home sales have lost some traction and it's not because of tightening supply. At 555,000, January's annualized pace came in more than 20,000 below the Econoday consensus and includes a big downward revision, not to December which is 1,000 lower at 535,000, but the cycle high in November which has been cut by 23,000 to 575,000. This report is one of the most volatile on the calendar which puts the priority on moving averages including the 3-month average which has fallen steadily from a cycle peak of 587,000 in September to only 555,000 (which is the same as January's rate).