Sales of new property in California jumped nearly 27 percent
from March to April as bargain hunters found it easier to get loans and pick up
property on the cheap.
Something like 37,000 houses were sold in the month, or about 27% in one month in one State of the TOTAL UK new house sales.
The prices were marginally down month on month, and about 28% down on a year ago.
If you have been paying attention, you will know I have great respect for the fluidity and flexibility of the US economy.
Two years ago, a particular house ( excluding land) cost about $190,000 to build.
Now, that same house only costs about $120,000. How? Partly it's explained by the fact that the product mix in US houses is quite different from ours, with lumber being a big input. Contractors have squeezed prices hard, so that only the most efficient mills can keep going. In Canada, which exported over 70% of it's lumber from generally older mills to the US, the industry is in serious trouble - the Yanks are hardly taking anything from over the border.
But my point is twofold. Firstly, houses are approaching a price in the US that people recognise as value. Secondly, even the bankers are realising the same thing and are prepared to bet some money on it.
The US is not out of its problems yet, but its already looking towards the next boom.
Unfortunately, we aren't.