Monday, November 28, 2011

New Home Sales Increased 1.3% in October

Sales of new homes increased 1.3% to an annualized pace of 307,000 units according to a Census Bureau report released this morning. This follows a strong downward revision of September’s pace, to 303,000 from 313,000. Although this report indicates growth, there has been less growth than previously thought.

We continue to see a slow recovery in the new home market, with sales up 8.9% on a year ago basis. The pace now seen is the most rapid since May. The months supply of new homes on the market continues to steadily drop to a low 6.3, the lowest level since June 2006. However, this does not indicate strength in the housing market; there is simply no demand, so builders aren’t supplying as many new homes.

The median home price appreciated 3.3% in October for the first time in four months.

Read the report.

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