How Important Are Home Sales?

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July 22 (Bloomberg) -- Dominic Chu reports on the latest markets news on Bloomberg Television's "Bloomberg West." (Source: Bloomberg)

With us is an economics editor, michael.

There is all kinds of housing data out.

How important are the existing home sales in the big scheme of things?

We do not know why they went down.

The good news is they did not go down all of that much.

As you can see, they only went down 1%. there is still in over 5 million annual sales rate, and that is the good news.

The other possibility, and everyone was looking at this, perhaps the rise in mortgage rates recently had something to do with it.

The problem with that theory is that two months ago, things were going very, very well.

So that should not be a problem either, unless you did not locked in, and you have a problem there.

Another thing, inventories.

Enough homes for sale.

We got into the spring and summer selling season, but there are still not a lot of houses on the market.

It will take longer to sort this out.

We know mortgage rates over the past weeks have been steadily rising.

Could we see a bidding to existing home sales in maybe two, three, four months from now?

A lot of analysts say it is not going to happen.

They believe that with home prices rising, people are still going to be encouraged to sell their homes, and demand is enough that people will want to buy those homes.

In may be the speed that bothers people more than the absolute level.

As ben bernanke says, housing is the key.

The second-quarter has been marked down so much that we need some real growth create it is also a huge on the jobs front.

Existing homes asides, every new home creates two or three full- time jobs for a year, right?

That is the estimate, at least.

With existing homes, not enough inventory on the market, and they do not have enough construction workers.

A lot of people left that industry.

2 million, 3 million jobs destroyed.

It will take them awhile to get up to speed.

They are underperforming against the s&p. michael, thank you.

This text has been automatically generated. It may not be 100% accurate.

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