New Home Sales Jumped 3.7% In January, But Inventory Remains Tight

Posted by Patrick Barnard on February 27, 2017 No Comments
Categories : Residential Mortgage

New home sales in January were at a seasonally adjusted annual rate of about 555,000, an increase of 3.7% compared with a revised rate of about 535,000 in December and an increase of 5.5% compared with about 526,000 in January 2016, according to estimates released by the U.S. Census Bureau and the U.S. Department of Housing and Urban Development.

The median sales price of new homes sold in January was $312,900. The average sales price was $360,900.

As of the end of the month, there were about 265,000 new homes available for sale – about a 5.7-month supply at the current sales rate.

About 44,000 new homes were sold in the Northeast in January; that’s an increase of 15.8% compared with about 38,000 in December.

About 70,000 new homes were sold in the Midwest – an increase of 14.8% compared with about 61,000 in December.

About 290,000 new homes were sold in the South during the month – that’s up 4.3% compared with about 278,000 in December.

And about 151,000 new homes were sold in the West – down 4.4% compared with about 158,000 in December.

“This increase in new home sales is in line with our forecast for a steady, gradual recovery of the housing market,” says Granger MacDonald, chairman of the National Association of Home Builders (NAHB), in a statement. “However, the pace of growth may be hampered by supply-side headwinds, such as shortages of lots and labor.”

“We can expect further growth in new home sales throughout the year, spurred on by employment gains and a rise in household formations,” adds Robert Dietz, chief economist for NAHB. “As the supply of existing homes remains tight, more consumers will turn to new construction.”

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