Of course less new homes will help resale homes. Unless the builder expect demand to drop 25% in 2007, when these houses will come online. Then there would be 0 effect to the resale market. If the demand drop more than 25% and the new homes undercut resale homes in price, which they can very easily, then it would still hurt resale homes. But we don’t know what will happen until 2007 when it happens. But I’m sure those builder have a much better insight in the market than you or I.
