In
a report that is frequently volatile, new home sales surged 18.0
percent in August to a much higher-than-expected annual rate of 504,000.
To underscore the volatility, the high-end Econoday forecast was
465,000!
Low supply has been a stubborn problem holding down both sales of new homes and existing homes, and the surge in August sales has made this problem more pronounced. Supply of new homes at the current sales rate fell in August to 4.6 months from 5.6 months in the prior month. Builders will likely be scrambling to bring new homes onto the market which in August totaled 203,000 units vs 201,000 in July.
Prices may no longer be holding down sales, falling 1.6 percent on the median in the month to $275,600. Year-on-year, the median was up 8.0 percent in August which sounds high but not against the 33.0 percent gain in sales.
Looking regionally at sales, sales surged 50.0 in the West followed by a 29.2 percent gain in the East. In the South, where more new homes are sold than all other regions combined, sales rose 7.8 percent.
This report is a reminder of the housing market index where the traffic component, which had been lagging badly, is suddenly surging. New home buyers were serious in August, but whether this will be sustained is uncertain.
Low supply has been a stubborn problem holding down both sales of new homes and existing homes, and the surge in August sales has made this problem more pronounced. Supply of new homes at the current sales rate fell in August to 4.6 months from 5.6 months in the prior month. Builders will likely be scrambling to bring new homes onto the market which in August totaled 203,000 units vs 201,000 in July.
Prices may no longer be holding down sales, falling 1.6 percent on the median in the month to $275,600. Year-on-year, the median was up 8.0 percent in August which sounds high but not against the 33.0 percent gain in sales.
Looking regionally at sales, sales surged 50.0 in the West followed by a 29.2 percent gain in the East. In the South, where more new homes are sold than all other regions combined, sales rose 7.8 percent.
This report is a reminder of the housing market index where the traffic component, which had been lagging badly, is suddenly surging. New home buyers were serious in August, but whether this will be sustained is uncertain.
New home sales for July posted at a lower-than-expected 412,000 annual sales rate. But the two prior months were revised higher by a total of 28,000. July's gain was centered entirely in the South which rose 8.1 percent in the month. The South is by far the largest region for new home sales, outdistancing all other regions combined. Lack of new homes on the market had been constraining sales but increasingly less so. Supply on the market rose to 205,000 versus 197,000 in June, pulling up the monthly supply to 6.0 months at the current sales rate vs 5.6 in June.
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