November New Home Sales Down 11%
Sales of new single-family houses in November fell to a seasonally adjusted annual rate of 841,000, the Census Bureau and HUD reported yesterday. This is 11 percent below the revised October rate of 945,000, but is 20.8 percent higher than a year ago (696,000).
All four regions saw November declines. In the Northeast, sales fell by 2.5 percent to 39,000 units in November, seasonally annually adjusted, from 40,000 in October but was 18.2 percent higher than a year ago. In the Midwest, sales fell by 43.3 percent to 59,000 units in November from 104,000 units in October and fell by 24.4 percent from a year ago.
In the South, sales fell by 1.9 percent to 513,000 units in November, seasonally annually adjusted, from 523,000 units in October but improved by 30.5 percent from a year ago. In the West, sales fell by 17.3 percent to 230,000 units in November from 278,000 units in October but improved by nearly 20 percent from a year ago.
“We’ve made the point for several months now that sales have continued to eclipse its normal relationship to the pace of construction starts,” said Doug Duncan, Chief Economist with Fannie Mae, Washington, D.C. “Until homebuilders could accelerate their rate of construction, we argued that home sales were likely to pull back to a more sustainable rate. Therefore, we had expected a decline in November. However, large negative revisions to the prior three months resulted in a sales pace that was significantly weaker than we’d forecast. While we will likely revise downward our near-term sales forecast, this also implies that much of our anticipated sales/starts rebalancing has already occurred.”
HUD/Census reported the median sales price of new houses sold in November fell slightly to $335,300 from $337,500 in October. The average sales price rose to $390,100 in November, up from $383,300 in December.
The report said the seasonally adjusted estimate of new houses for sale at the end of November grew to 286,000 from 281,000 in October, representing a supply of 4.1 months at the current sales rate, up from 3.6 months in October.