The real estate market had a volatile April, with home sales rising at their fastest rate in 14 years. But the 16% spike in sales over the previous month hid a more complicated reality: New home prices dropped by a record 11%, according to Commerce Department figures released today, and builder confidence remains low.
Moreover, economists, who had predicted a minuscule 0.2% bump, caution that month-to-month figures are notoriously unreliable. "One big monthly change, in either direction, does not make a trend," cautions one economist in the Wall Street Journal, noting that the margin of error on the numbers is 13%—nearly enough to erase the gains. (More housing market stories.)