New home sales post strong pace in October
Tuesday, November 26, 2019 from Floor Covering Weekly
“Forty-five percent of homes sold in October were priced below $300,000, which is an indication that more millennial buyers are taking advantage of low mortgage rates and entering into the marketplace,” said Greg Ugalde, chairman of the National Association of Home Builders, and a home builder and developer from Torrington, Conn.
“For-sale inventory remains tight as this marks the third consecutive month below a six-month supply,” said Danushka Nanayakkara-Skillington, NAHB’s assistant vice president of Forecasting and Analysis. “The low inventory rates show there is a need for added construction to meet growing demand.”
A new home sale occurs when a sales contract is signed or a deposit is accepted. The home can be in any stage of construction: not yet started, under construction or completed. In addition to adjusting for seasonal effects, the October reading of 733,000 units is the number of homes that would sell if this pace continued for the next 12 months.
The inventory of new homes for sale was 322,000 in October, representing a 5.3 months’ supply. The median sales price was $316,700. The median price of a new home sale a year earlier was $328,300.
Regionally, and on a year-to-date basis, new home sales are 15.7 percent higher in the South and 9.1 percent higher in the West. Sales are down 11.1 percent in the Northeast and 7.5 percent in the Midwest.