Today, the Census Bureau reported that new home sales blew apart estimates coming in at 677,000. This print is probably the biggest deviation from sales trend I have seen in this cycle. Both new home sales data and housing starts data have wide spreads month to month. The large deviation of this print is due, in part, to the effects of the hurricanes — but it is a positive print, nonetheless.
In my 2017 Housing Prediction article published in December 2016, I wrote this regarding new home sales:
” For 2017, I predict 4%-7% growth, if the positive trend of builders offering smaller homes continue then we can have much more growth in sales in 2017
Year to date sales are running at 8.6% with this massive print, so even if this print gets revised lower or sales trend go back to trend sales growth for 2017, we are exactly where we should be for 2017.
New Home Sales:
Sales of new single-family houses in September 2017 were at a seasonally adjusted annual rate of 667,000,
according to estimates released jointly today by the U.S. Census Bureau and the Department of Housing and
Urban Development. This is 18.9 percent (±19.0 percent)* above the revised August rate of 561,000 and is
17.0 percent (±22.4 percent)* above the September 2016 estimate of 570,000.
The median sales price of new houses sold in September 2017 was $319,700. The average sales price was
For Sale Inventory and Months’ Supply:
The seasonally-adjusted estimate of new houses for sale at the end of September was 279,000. This
represents a supply of 5.0 months at the current sales rate
Monthly supply of new homes in this cycle has been higher than in the previous one, but with this report we see a massive drop in supply from 6.1 months to 5 months, showing the impact of the hurricane due to the big deviation print in sales.
From Calculated Risk:
Revisions to last month’s numbers were slightly positive but they were still showing a YoY decline for those months. Total sale trends however are up for 2017 but still really, really low considering where we are in the cycle– which, to put a positive spin on it, means we have legs to grow.
Today on facebook live I discussed what grades I give to all housing data this year and what would a John Taylor Fed Chair look like!
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Logan Mohtashami is a financial writer and blogger covering the U.S. economy with a specialization in the housing market. Logan Mohtashami is a senior loan officer at AMC Lending Group, which has been providing mortgage services for California residents since 1987. Logan also tracks all economic data daily on his own facebook page https://www.facebook.com/Logan.Mohtashami