Are people finally cooling on the hottest cities?

WED, JUN 26, 2019

YOUR AFTERNOON NEWS UPDATE AND MARKET ACTION FROM CNBC

AS OF WED, JUN 26, 2019 • 12:19 ET

DJIA		26614.06
		+0.25%	+65.84

S&P 500		2922.85
		+0.19%	+5.47

NASDAQ		7935.26
		+0.64%	+50.54

EDITOR'S NOTE

You might have seen the headlines yesterday about Lennar shares falling 5% or so because of China tariffs being a drag on business.

That was one of a bunch of interesting nuggets from the homebuilder's earnings report and conference call. Another one: that their high-end California markets are being hit by a lack of interest from Chinese buyers. Also, that profit margins will suffer as Lennar brings more (much-needed) entry-level housing online, especially in places like Texas.

On top of all that, as Diana Olick points out in her story on why new home sales overall were weak in May: there is a ton of existing-home inventory coming into the market lately in competitive markets.

Specifically, the supply of existing homes for sale is up 85% in Las Vegas from a year ago, 52% in Seattle, and 21% in Dallas, according to Raymond James analyst Buck Horne. Wow!

I asked Horne, when we joined us on Power Lunch yesterday, why that is. He said it might be because "mobility is coming back" to those markets after years of rising home prices and an extremely competitive bidding environment.

Which has me wondering if we might be on the verge of a new wave of migration, out of those flourishing cities and into smaller, cheaper markets that could really use the population. (Not coincidentally, Iowa Governor Kim Reynolds was also with us yesterday, after launching their "This is Iowa" effort to lure New Yorkers with their cheaper cost of living.)

Or perhaps that's just wishful thinking. After all, lots of us stay in the tristate NY-NJ-CT area quite simply because of our jobs. And on that note, New Jersey Governor Phil Murphy will join me on The Exchange today. Don't miss it :-)

See you at 1 p.m.!

Kelly

Kelly Evans

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