New Home Sales Tumble in August but Still Top Projections
Sales of new single-family houses in August slipped 7.6 percent, but remain above monthly projections, according to new results from the Commerce Department. Single-family home sales were at a seasonally adjusted annual rate of 609,000, soaring 20.6 percent above the August 2015 estimate of 505,000.
So what are homes selling for? According to the study, the median sales price of new houses sold in August 2016 was $284,000. The average sales price was $353,600. The seasonally adjusted estimate of new houses for sale at the end of August was 235,000. Currently there is a steady home supply of 4.6 months.
This new data shows that although sales took a small tumble, they are rising above projections. Prices are steady, supplies are solid, and the market appears to be on a good track for the rest of the year.
On Monday’s report, realtor.com® Chief Economist Jonathan Smoke stated, “Based on recent data, you might think that the housing market took a turn for the worse in August – but it didn’t. In fact, we are seeing good signs that the new home market is finally growing substantially, with sales of new homes up bigtime over this time last year and so far this year. It looks like these gains are happening because builders are shifting product towards more affordable price points and responding to strong demand by building with contracts in hand. This August only 30 percent of new homes sold were already completed.”
Smoke continued, “Even with a continued lack of homes on the market, total home sales are up 4 percent over last year. That shows a clear shift in the composition of sales – new homes have more room to grow while existing homes are limited by their owners’ willingness to sell.”
Quicken Loans vice president Bill Banfield offered the following comments on the report:
“It’s encouraging to see strong demand for newly constructed homes persist as we reach the tail-end of summer. While we’d always like to see a bit more inventory come into play, housing continues to be a bright spot in the overall economic picture.”
For more information, visit www.census.gov.