There is a lot of confusion out there today over how the first time home buyer tax credit extension figures into the Commerce Department's report on sales of new construction.

"New Home Sales," as we call it, plummeted 11 percent, quite unexpectedly, after another rise in "Existing Home Sales" yesterday.

Let's look at timing, shall we?

The "New Home Sales" number is based on contracts signed on homes, not closings. The "Existing Home Sales" number is based on closings. So the November surge in Existing would have reflected a final push to get in under the wire on the first time home buyer tax credit, which was supposed to expire Nov. 30th. Realtors tell us 51 percent of sales in November were by first timers.