New Home Sales

What’s Going On With New Home Sales

The Census Bureau reported new home sales for November at a seasonally adjusted annual rate (SAAR) of 590,000 units. That was well below expectations. The median new home price was $434,700 according to Census estimates. The average new home price was $488,900. The inventory of new homes rose to 9.2 months of supply. That put inventory at the highest levels of the year, and back to where it stood in November 2022. But there's a catch. This is November data. The November Census estimate on new home sales doesn't capture the capitulation from Janet (Treasury) [...]

New Home Sales Bounce in May with Big Drop in Prices

The Census Bureau reported new home sales in May at a seasonally adjusted annual rate (SAAR) of 763,000 units. That was 12.2 percent better than the revised April estimate and 20 percent better than May of last year. So what drove the jump in new home sales? Lower prices! "The median sales price of new houses sold in May 2023 was $416,300. The average sales price was $487,300." That average new home price of $487,300 is the lowest in 2023 and over $28,000 lower than the March estimate. The May average price is $81,400 lower [...]

Denton County New Home Market Headed for Another Slowdown

Denton County's new home market is headed for another slowdown. High prices and a rebound in interest rates to that critical seven percent mark are just part of the problem. There's also a pending recession on deck. The Census Bureau reported April new home sales at a seasonally adjusted annual rate of 683,000 units. That was better than expected, but previous months were revised lower. Cancellation rates for builders have come back down, but new home affordability remains an issue. There is still a large backlog of homes under construction. Any softness in the economy [...]

Price Drops and Lower Mortgage Rates Provided Temporary Lift to New Home Sales

The Census Bureau reported new home sales for January at a seasonally adjusted annual rate of 670,000 units. This is old news, but more confirmation of what we have seen in the local North Texas housing market. The boost to new home sales at the end of 2022 and January of this year was the result of improved affordability. It was a confluence of several events. The key ingredients were as follows: Overly loose financial conditions with many Americans still sitting on excess savings Falling mortgage rates in December and January Significant price reductions from [...]

New Home Sales Receive a Small Boost From Lower Prices and Rates

New home sales received a slight boost in December. The Census Bureau reported new home sales at a seasonally adjusted annual rate of 616,000 units. This was in line with expectations, but previous months were revised lower. The median price of a new home in the U.S. was $16,900 lower in December. Sales were also helped by mortgage rates dropping roughly half a percentage point. The supply of new homes dipped in December, but finished inventory continues to grow. There are now 1.4 months of completed new construction inventory in the U.S. There is plenty [...]

New Home Inventory Continues Rebound in North Texas

New home inventory continues to rebound in North Texas. The supply of available new construction inventory experienced a sharp decline coming out of the pandemic. It rebounded sharply this year with the demand crush from the Federal Reserve and a doubling of mortgage rates. The Census Bureau reported new home sales for November at a seasonally adjusted annual rate of 640,000 units. Sales for the previous months were revised down sharply. New home inventory posted at 8.6 months of supply according to Census. The Census sales numbers will continue to be noisy and overstated as [...]

Census Overestimates October New Home Sales

The Census Bureau reported new home sales for October at a seasonally adjusted annual rate of 632,000 units. Take the headline sales number with a huge grain of salt. The Census numbers are notorious for monthly revisions. It's reasonable to expect the October sales estimate will receive a haircut.  Census estimates are obviously not capturing the spiking cancellation rates of home builders. The October estimate also does not fit with numbers builders have been reporting on actual sales in the latest quarter. The attached chart comparing Census estimates for sales vs the October spike in [...]

New Home Sales Are Weaker Than Census Estimates

The Census Bureau reported new home sales for September at a seasonally adjusted annual rate of 603,000 units. According to Census estimates new construction sales fell 10.9 percent from August, putting sales down 17.6 percent from last year. Sorry Census, but you're a little late to the party. New home sales are materially weaker than these official guestimates. We had a good indicator from the third largest builder in the country, PulteGroup which just reported earnings this week. Pulte posted a net decline in new home orders of 28 percent compared to last year. The [...]

New Home Sales Take a Dive in July – 7.3 Months Supply of New Homes Under Construction

New home sales dropped sharply in July. High prices and dramatically higher mortgage rates have taken their toll on the new construction housing market. The median sales price of new houses sold in July 2022 came in at $439,400. The average sales price was $546,800. That rebound in prices was exactly what the new home market didn't need. New home affordability has been crushed with higher mortgage rates. "Sales of new single‐family houses in July 2022 were at a seasonally adjusted annual rate of 511,000, according to estimates released jointly today by the U.S. Census [...]

New Home Prices Drop Sharply as Sales Hit a Wall

The Census Bureau reported new home sales for June at a seasonally adjusted annual rate of 590,000 units. This was below expectations. The three previous months were revised lower as well. New home sales in June were 8.1 percent lower than May and 17.4 percent lower than the same time last year. The median price of a new home dropped to $402,400. The average sales price posted at $456,800. Those were the lowest prices for 2022. Average new home prices just crashed 19.8 percent ($112,500) from the April blow-off top this year according to Census [...]

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