Tag Archives: New Home Sales

The number of newly-built homes sold slipped 8 percent in June from the month prior, says the U.S. Census Bureau in its latest New Home Sales report. The June data shows 350,000 homes sold nationwide on a seasonally-adjusted, annualized basis.

The home sale tally fell short of Wall Street expectations but the Census Bureau revised higher its previously-released results for March, April and May by a collective 33,000 units. This left the June New Home Sales report as the weakest of the last five months, yet still stronger than the 21 months preceding February.

In other words, despite retreating from May, the June New Home Sales data was still quite strong. As compared to June of last year, sales of newly-built homes are higher by 15% and the national inventory of new homes for sale is down to 144,000 units.

This marks a 13 percent inventory reduction in just twelve months.

At the current sales pace nationwide, the complete stock of new homes would “sell out” in 4.9 months, a noteworthy data point because analysts believe that a 6.0-month supply of homes marks a market in balance. Home supplies of below 6.0 months suggest a “seller’s market” where sellers have pricing power and excess leverage in negotiations. 

Home supplies have been south of 6.0 months since October 2011. This is the same month that marked a shift with other housing data points, too, including Existing Home Sales and the Home Price Index.

Since October 2011, the average new home sale price is higher by 6% nationwide, a trend that should continue in King of Prussia through the end of 2012 and into 2013 — especially with mortgage rates at new all-time lows and home affordability at all-time highs. As more buyers enter the market amid limited supply, prices are expected to rise.

If you’re a home buyer in search of new construction, therefore, the best new home “deals” you may find may be the ones you find today.

The new construction market continues to improve.

As reported by the Census Bureau, 369,000 new homes were sold last month on a seasonally-adjusted, annualized basis. A “new home” is a home that is considered new construction.

May’s data marks the highest number of new homes sold since April 2010, the last month of that year’s federal home buyer tax credit.

It’s also a 14% increase over the rolling 12-month average.

The news was somewhat expected based on the most recent Homebuilder Confidence survey, which rose to a 5-year high. Home builders have been reporting higher sales volume and rising buyer foot traffic since October of last year. 

The May New Home Sales report confirms what builders already told us.

Furthermore, new homes are selling more quickly than builders have built them, lowering the national “home supply” to levels not seen since October 2005. There are currently 145,000 new homes for sale.

A supply of 6.0 months is believed to represent a market in balance. Anything less connotes a “sellers’ market”. At the current pace of sales, the entire new home housing stock would be exhausted in 4.7 months.

The South Region continues to account for the majority of new construction sales, posting a 55% market share in May. South Region sales were up 13 percent as compared to April. The other 3 regions turned in mixed results :

• Northeast Region : +36.7% from April 2012
• Midwest Region : -10.6% from April 2012
• West Region : -3.5% from April 2012

For all its strength, though, the Census Bureau’s New Home Sales data may also be “off”.

Although New Home Sales were said to rise by roughly 8 percent nationally from April to May, the government’s monthly report was also footnoted with a ±12.2% margin of error. This means that the actual New Home Sales reading may have been as high as +20% last month, or as low as -4%. The values could be positive or negative — we can’t know for certain.

However, that’s not to say that the New Home Sales should be ignored.

Longer-term, new home trends have been positive and builder confidence survey suggests the same.  If you’re in the market for new construction in Phoenixville , you may want to go into contract soon. Home prices and mortgage rates remain low — a terrific combination for today’s home buyers.

Sales of new homes ticked lower in March, unexpectedly.

Based on Census Bureau data, the number of new, single-family homes sold in March slipped 7 percent from February — the largest one-month drop in more than a year. 

On a seasonally-adjusted, annualized basis, buyers in Pennsylvania and nationwide purchased 328,000 newly-built homes last month. The decrease in sales from February to March can be attributed, in part, though, to a massive upward revision in February’s figures.

Last month, the Census Bureau had reported 313,000 new home sales in February on a seasonally-adjusted, annualized basis. This month, those sales were re-measured to be 353,000 — an increase of 13 percent.

January’s sales were revised higher, too.

The long-term trend in the market for new homes remains “up”. This is no more apparent than when we look at the available new home inventory.

At the close of March, just 144,000 new homes were available for purchase, down 2,000 from the month prior and representing the most sparse new home housing supply since at least 1993, the year that the Census Bureau starting tracking such data. 

At the current pace of sales, the new home housing stock would be sold out in 5.3 months. A six-month supply is believed to represent a market in balance.

For new home buyers in Collegeville , March’s New Home Sales report does not represent a housing market pull-back. It may represent opportunity, however.

From October 2011 to February 2012, housing data was uniformly strong. Home sales were higher, home supplies were lower, and confidence was rising. In March, it was the reverse. This is normal because growth is rarely linear. 

In any market, it’s a few steps forward and a single step back, and housing is likely showing a similar pattern. With mortgage rates still low and builder confidence down, it’s a terrific time to shop new construction.

There are deals to be found for buyers who seek them out. 

Sales of “new homes” fell to the lowest levels in four months last month.

According to the Census Bureau’s monthly New Home Sales report, 313,000 new homes were sold in February 2012 on a seasonally-adjusted, annualized basis, representing a 1.6% drop from the month prior.

A “new home” is a home for which there has been no prior owner nor tenant.

At first glance, the data looks negative for the housing market; a suggestion that the well-publicized housing market recovery may be slowed. However, within February’s New Home Sales report are three important counter-statistics worth mentioning.

First, although annualized home sales volume slipped 5,000 units in February, this occurred as the number of homes for sale nationwide remained constant at 150,000. This is the fewest number of new homes for sale since at least 1993 — the first year that the Census Bureau tracked such data.

A small home supply promotes rising home values when buyer demand is rising and, in February, buyer demand held firm.

A second reason to remain optimistic on housing is that New Home Supply was 5.8 months in February. This means that, at the current pace of sales, the entire new home inventory will be “sold out” in 5.8 months.

Housing experts say that when home supplies fall below 6.0 months, it’s bullish for housing.

And, as a third reason to look past the New Home Sales headline figure, last month’s reporting Margin of Error was huge.

According to the government, the February New Home Sales data was published with a ±23.9% margin of error. This means that the actual New Home Sales sales volume may have dropped as much as -25.5%, or may have climbed by as much as +22.3%. 

Because the range of possible values includes both positive and negative numbers, the Census Bureau assigned its February data the “zero confidence” label.

It will be several months before February’s New Home Sales data is revised. Until then, buyers in Collegeville would do well to take cues from the real estate market-at-large which shows steady, gradual improvement. 

If your 2012 housing plans call for buying new construction, consider using February’s results as a window to “make a deal”. As the year progresses, great values in housing may be gone for good.

The new construction market rolls on.

As foreshadowed by February’s Homebuilder Confidence survey, which rose to a 4-year high, the Census Bureau reports new homes are selling more quickly than builders have built them, lowering the national “home supply” to levels not seen since 2006.

A “new home” is a home that is considered new construction and, at the current pace of sales, the nation’s entire new home inventory of 151,000 homes would be sold in 5.6 months.

Anything less than 6.0-month supply is thought to connote a “sellers’ market”.

321,000 new homes were sold last month on a seasonally-adjusted, annualized basis. 7 of 10 new homes sold for less than $300,000. 

The South Region continues to account for the majority of new construction sales, posting a 59% market share in January. South Region sales were up 9 percent as compared to December. The other 3 regions turned in mixed results. 

• Northeast Region : +11.1% from December 2011 
• Midwest Region : -24.5% from December 2011 
• West Region : -10.6% from December 2011 

Unfortunately, the Census Bureau’s New Home Sales data could be wrong.

Although New Home Sales were said to fall by about one percent nationally from December to January, the government’s monthly report was footnoted with a ±16.6% margin of error. This means that the actual New Home Sales reading may have been as high as +15%, or as low as -18%. 

Because the range of values includes positive and negative values, the January New Home Sales data is of “zero confidence”. However, that’s not to say that it should be ignored. The aforementioned homebuilder confidence survey shows builders optimistic for the future, and a bevy of home sale data since October 2011 suggests a market in recovery.

If you’re in the market for new construction in Collegeville , therefore, consider going into contract sooner rather than later. Home prices remain low and mortgage rates do, too — a terrific combination for today’s buyers.

In a few months, the landscape may look different.

New Home Sales slowed into the New Year but the market for newly-built homes remains strong. For home buyers in Pennsylvania and nationwide, December’s New Home Sales report is yet one more signal that the housing market recovery may be underway.

According to the Census Bureau, the number of new homes sold in December 2011 slipped 2 percent to 307,000 units on a seasonally-adjusted, annualized basis nationwide.

A “new home” is a home that is considered new construction; a home for which the buyer will be the first owner and tenant.

As compared to December 2010, last months’ sales volume fell seven percent. It’s a statistic that suggests housing market weakness. However, in looking at a different component of the New Home Sales report — the supply of homes for sale — we’re forced to reconsider.

At the current pace of sales, every new home for sale nationwide would be “sold” in a matter of 6.1 months. 

Economists believe that a 6.0-month supply defines a market in balance — anything quicker is termed a “seller’s market”. Statistics like that are enough to create urgency among today’s King of Prussia home buyers. 

Unfortunately, the Census Bureau’s data may be wrong.

Although December’s New Home Sales report shows sales down 2 percent, the government’s data was published with a ±13.2% margin of error. This means that the actual New Home Sales figure may have been as low as -15.2 percent, or as high as +11.2 percent. And, because the range of possible values includes both positive and negative numbers, the Census Bureau had no choice but to assign its December data “Zero Confidence”.

It will be a few months before final revisions are made to December New Home Sales data. Until then, therefore, buyers should take cues from the market-at-large and the market-at-large hints at recovery. One example of this is homebuilders showing more confidence in their product than at any time in the last 5 years.

If your plans for 2012 call for buying new construction, therefore, consider using this lull to “make a deal”. As the year progresses, the great values in housing may be gone.