New Home Sales Continue To Increase
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Loading... - Harold Thomas
- 27 Feb 2023
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New home sales saw an increase in January, with the help of declines in mortgage rates and home prices, and an increased use of builder incentives.
The National Association of Home Builders (NAHB) reported that newly released data by the U.S. Department of Housing and Urban Development and the U.S. Census Bureau demonstrated that sales of newly built, single-family homes in November increased 7.2% to a rate of 670,000, the fourth consecutive monthly increase.
New home sales have been continuously rising since October, increasing by 7.5% from September to October, 5.8% from October to November and 2.3% from November to December. However, the current January rate is 19.4% below that of this time last year.
“The latest HMI survey shows 57% of builders are using incentives to bolster sales, including providing mortgage rate buy-downs, paying points for buyers and offering price reductions,” said Alicia Huey, chairman of the NAHB. “Buyer incentives, along with stabilizing mortgage rates during the month of January, increased the pace of new home sales for the month. However, in a sign of current market weakness, sales are down 19.4% compared to a year ago.”
Regionally, new home sales fell in three regions, down 19.4% in the Northeast, 6.9% in the Midwest and 7.3% in the West. The only region that saw an increase was the South, at 17.1%.
The estimate of new houses for sale at the end of January was 439,000, which represents a supply of 7.9 months at the current sales rate (a measure near six months is considered balanced). Completed, ready-to-occupy inventory is up 115% from one year ago, from 34,000 last year to 73,000 in January. This inventory type, however, remains at only 17% of total inventory.
The median new home sale price was $427,500, down 8.2% from December and the third straight monthly decline from the October peak of $496,800. The average sales price was $474,400. Read More…
