New Home Sales See An Unexpected Surge

With reports of slower buyer demand, higher mortgage rates, and economic uncertainty in the news, you might expect that sales of newly built single family homes would be falling. Economists polled by Reuters certainly did. Polled before the release of the U.S. Census Bureau and Department of Housing and Urban Development’s New Residential Sales report, economists said they expected sales would decline to an adjusted annual rate of 500,000 units. Instead, the newly released numbers show sales surging to an annual pace of 685,000 units. In other words, sales of new homes spiked 28.8 percent in August from the month before. The improvement seems like encouraging news for the market at a time when buyers are hesitant and traffic is down. However, the gains may be short lived, since mortgage rates, after several weeks of decline, have jumped higher in recent weeks. Also in the report, the median sales price of new homes sold in August was $436,800. The average price was $521,800. (source)

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