New-Home Sales Fall in October, But Are Still Up Over Long Haul
November 27, 2019
Sales of newly built single-family homes faltered last month, but overall sales are still performing stronger than they did a year ago. Indeed, new-home sales are still nearly 10% higher than a year ago. Also, the past two months in new-home sales represent the highest monthly sales rate since October 2007, the Commerce Department reported Tuesday.
Sales of new single-family homes adjusted to an annual rate of 733,000 units in October, down 0.7% compared to September.
“For-sale inventory remains tight as this marks the third consecutive month below a six-month supply,” says Danushka Nanayakkara-Skillington, the NAHB’s assistant vice president of forecasting and analysis. “The low inventory rates show there is a need for added construction to meet growing demand.”
The inventory of new homes for sale was 322,000 in October, which marks a 5.3-month supply at the current pace. The median sales price was $316,700, which is down from a year ago when the median price of a new home sale was $328,300.
“Buyers are facing not enough choices,” says Lawrence Yun, chief economist of the National Association of REALTORS® “Therefore, prices are getting bid up, especially in the starter home market and in the mountain states.”
Regionally, new-home sales were highest in the South last month, up 15.7% annually. New-home sales were also up by 9.1% in the West. But they dropped in October by 11.1% in the Northeast and by 7.5% in the Midwest year over year.
Updated: July 10, 2020