The U.S. Census Bureau and the Department of Housing and Urban Development reported Monday morning that sales of new homes in October rose to a seasonally adjusted annual rate of 685,000, an increase of 6.2% above the downwardly revised September rate of 645,000 and a rise of 18.7% compared with the October 2016 rate of 577,000. The consensus estimate from a survey of economists expected a rate of around 620,000. The September rate was revised downward by 18,000.
At the peak in 2005, new home sales posted a seasonally adjusted annual rate of nearly 1.4 million. September’s annual rate of sales was the highest for the month in the past 10 years.
The Census Bureau also reported that the median sales price for new homes sold in October fell by $6,900 from $319,700 in September to $312,800, and the average sales price rose by $15,000 to $400,200. At the end of October the number of new homes for sale totaled 282,000, up by 3,000 month over month and represented a supply of 4.9 months at the current sales rate.
In October, 47% of the estimated 55,000 monthly sales were sales for homes priced at less than $300,000. The percentage is up five percentage points compared with the September rate. Sales of homes priced between $300,000 and $399,999 fell by seven points to 19% of all sales. Sales of homes in the range of $400,000 to $499,999 rose from 13% to 17%, and sales fell from 14% to 10% for homes sold in a range of $500,000 to $749,999. Home sales for properties priced above $750,000 accounted for 7% of all new home sales in October, up two points compared with September.
The increase in sales of houses priced below $300,000 was almost entirely the result of a four-point increase in the number of houses sold that cost more than $200,000 but less than $300,000.
In the South, home sales fell by 2,000 month over month in October to 149,000, down from 151,000 in September and 153,000 in August as the region recovers from the effects of last summer’s hurricanes.