New Home Sales Fall After Spiking In July

Sales of newly built, single-family homes fell in August after rising to the fastest sales pace in 9 years the month before. The data, released by the U.S. Census Bureau and the Department of Housing and Urban Development, shows new home sales down 7.6 percent month-over-month, though they remain nearly 21 percent higher than last year. But though the monthly decline may seem like a setback, there are a number of encouraging signs in the report for prospective home buyers. For starters, the number of new homes on the market rose nearly 2 percent last month. With inventory low, an increasing number of new homes available for sale is a promising sign, especially when combined with the fact that building permits also rose in August. That may indicate future gains to inventory levels across the country. And, with rising inventory, price increases should begin to moderate. For example, this month’s report shows the median price for a new home fell 5.4 percent from one year ago. In fact, the median sales price of new homes sold in August was $284,000; the average sales price was $353,600. Also in the report, new home sales were down sharply in the Northeast and South. The West saw an 8 percent increase and the Midwest fell 2.4 percent. More here.

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