New Home Sales Showing Rapid Acceleration

Boosted by low mortgage rates and a strong labor market, new home sales are showing rapid acceleration. Sales of new single-family homes came in at 733,000 in October, easily beating not only Econoday's consensus but also the range of expectations. Moreover, September sales were revised sharply higher from 701,000 to 738,000. Year-on-year, October sales are up an impressively robust 31.6 percent.

The news may still be mixed for home builders, however, who appear to be boosting sales with price concessions, as the median price for a single-family new home was $316,700 in October, for a year-on-year contraction of 3.5 percent.

Supply fell to a lean 5.3 months relative to sales which may, though prices are less than strong, encourage more activity among builders.