August New Home Sales Rise as Prices Moderate

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The U.S. Census Bureau and the Department of Housing and Urban Development reported Wednesday morning that sales of new homes in August increased to a seasonally adjusted annual rate of 629,000, an increase of 3.5% from the revised July rate of 608,000 and an increase of 12.7% compared with the August 2017 rate of 558,000. The consensus estimate from a survey of economists expected a rate of around 630,000. The July rate was revised downward by 19,000.

At the peak in 2005, new home sales posted a seasonally adjusted annual rate of nearly 1.4 million.

The Census Bureau also reported that the median sales price for new homes sold in August fell by $8,500 from $328,700 in July to $320,200, and the average sales price slipped by $5,900 to $88,400. At the end of August the number of new homes for sale totaled 318,000, up by 9,000 month over month, and represented a supply of 6.1 months at the current sales rate.

In July, 45% of the estimated 50,000 monthly total were sales for homes priced at less than $300,000. The percentage is up from 39% in July.

Sales of homes priced between $300,000 and $399,999 dropped seven points to 22% of all sales. Sales of homes in the range of $400,000 to $499,999 rose by a point to 13%, and sales rose by 1% 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 August, flat compared with July.

On a seasonally adjusted basis, new home sales are up 12.7% year over year nationally. In the South new home sales are up 11.5%, in the Northeast down 2.9%, in the Midwest up 13.2% and in the West up 19.1%.

On a non-seasonally adjusted basis, homes sold In the South fell by 4,000 (13%) month over month in August to 27,000. Home sales were flat at 7,000 in the Midwest, while sales in the Northeast totaled 3,000, up by 1,000 month over month. Sales in the West rose by 2,000 to a total of 14,000.

At the end of August, the for-sale inventory (not seasonally adjusted) totaled 325,000, up 12,000 month over month. On a non-seasonally adjusted basis, inventory was flat in the Northeast at 27,000 and up by 2,000 in the Midwest to 43,000. In the South new homes for sale rose by 7,000 to 169,000 while supply in the West rose by 2,000 to 87,000.