by The Cushing Team of Guild Mortgage Company | 6990 S. McCarran Blvd, Suite 200, Reno, NV 89509

New Home Sales, which measure signed contracts on new homes, rose 7.5% in October to a 632,000-unit annualized pace, coming in much better than the 5.5% decline that was expected. There was a negative revision to September’s sales that made October’s gain appear a bit bigger, but even when factoring this in sales were up 5.5%.
The median home price for new homes was $493,000, which was an increase from September, but remember this is not the same as appreciation. It simply means half the homes sold were above that price and half were below it, and this figure can be skewed by the mix of sales. Last month, there was a big uptick in sales of homes in the $500,000 and over segments.
What’s the bottom line? These sales figures were from October when rates were half a percent higher, so contract signings may continue to pick up. And while sales are now down 5.8% from October of last year, this year’s figure is not so bad considering higher rates, inflation and tight inventory.
Speaking of inventory, there were 470,000 new homes for sale at the end of October, which equates to an 8.9 months’ supply. However, only 61,000 or 13% were actually completed, with the rest either not started or under construction. The amount of completed homes equates to a 1.2 months’ supply, well below a balanced market.

Posted by Jeff Sallan on
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