January New Home Sales Tumble Again

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The U.S. Census Bureau and the Department of Housing and Urban Development reported Monday morning that sales of new homes in January fell to a seasonally adjusted annual rate of 593,000, a decrease of 7.8% from the upwardly revised December rate of 643,000 and a dip of 1% compared with the January 2017 rate of 599,000. The consensus estimate from a survey of economists expected a rate of around 600,000. The November rate was revised upward 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 January fell by $12,400 from $335,400 in December to $323,000, and the average sales price rose by $16,200 to $382,700. At the end of January the number of new homes for sale totaled 301,000, up by 6,000 month over month, and represented a supply of 6.1 months at the current sales rate.

In January, 43% of the estimated 44,000 monthly sales were sales for homes priced at less than $300,000. The percentage is up 1 percentage point compared with the December rate.

Sales of homes priced between $300,000 and $399,999 were flat at 25% of all sales. Sales of homes in the range of $400,000 to $499,999 rose from 11% to 15%, and sales slipped from 15% to 11% for homes sold in a range of $500,000 to $749,999. Home sales for properties priced above $750,000 accounted for 5% of all new home sales in January, down 2 points compared with December.

In the South, home sales fell by 50,000 month over month in January to 301,000. Home sales also slipped in the Northeast from 36,000 in December to 24,000 in January.

On a seasonally adjusted basis, new home sales are down 1% nationally year over year. In the West, new home sales are up 33.1%; in the South sales are down 10.9%; in the Midwest sales are up 2.7%; and in the Northeast sales are down 44.2%.