New Home Sales

April New Home Sales, a measure of contract signings for the purchase of
new homes, totaled 352k annualized, 8k less than expected and March was
revised down by 5k to 351k. However, months supply fell to 10.1 from
10.6 and it’s the lowest inventory relative to sales since Feb ’08. The
absolute # of homes fell by 13k to the lowest since May ’01 as builders
continue to build less in response to the obvious lack of demand and
also due to the competition of foreclosures. To put in perspective the
absolute # of new homes for sale, at 297k is about 50k below the average
since 1970. The median new home price was down 14.9% y/o/y but rose 3.7%
m/o/m. Relative to March, sales were unchanged in the Northeast and
Midwest, fell slightly in the West but rose a touch in the South.
Net-net, while this is an important read on the housing market, existing
home sales make up more than 80% of all sales, thus making yesterday’s
data point more relevant to the markets.

DISCLAIMER

Although the information contained herein has been obtained from sources
Miller Tabak + Co., LLC believes to be reliable, its accuracy and
completeness cannot be guaranteed. This report is for informational
purposes only and under no circumstances is it to be construed as an
offer to sell, or a solicitation to buy, any security. At various times
we may have positions in and effect transactions in securities referred
to herein. Any recommendation contained in this report may not be
appropriate for all investors. Trading options is not suitable for all
investors and involves risk of loss. Although the information contained
in the subject report (not including disclosures contained herein) has
been obtained from sources we believe to be reliable, the accuracy and
completeness of such information and the opinions expressed herein
cannot be guaranteed. An options disclosure document may be obtained
from Mr. Jay Stenberg, Miller Tabak + Co., LLC., 331 Madison Avenue, New
York, NY 10017. Additional information is available upon request.

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