Nationwide, sales of new homes jumped 27% in March from the month before and 24% compared with March 2009. A key index of homebuilder stocks is up 16% this year, compared with a rise of 3.4% in the Dow index. One major builder, Lennar Corp., has seen its shares rocket 47%.

So the apartment costs 25 times the household’s gross income. For a U.S. household making $40,000 a year, that is the equivalent of buying a $1 million condo.

The folly is always based on the same premise: the government will never let real estate fall in value. Indeed, a collapse in price is impossible.

My column for the March 2010 issue of Builder & Developer magazine is now online. For this issue, I focused on how builders are downsizing square footage but keeping high-quality materials and focusing on compelling designs demanded by today’s buyers. You can read the entire article by clicking here. An excerpt: For years we’ve been [...]

From The Mortgage Bankers Association: Weekly Application Survey The Market Composite Index, a measure of mortgage loan application volume, increased 9.1 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 10.4 percent compared with the previous week and decreased 52.3 percent compared with the same week one [...]

Any number below 50 indicates that more builders view sales conditions are poor. The record low was a reading of 8 in January of 2009 and the index has been in a general range of 15-19 over the last year. The National Association of Home Builders reports Builder Confidence Declines in January January 19, 2010 [...]