New single-family home sales in the US rose 4.3 percent in November to a seasonally adjusted annual rate of 490,000 units, while October’s sales growth was revised down by the Commerce Department from 495,000 to 470,000 units, reported Reuters.
Economists expect last month’s new home sales, which account for around 9.3 percent of the housing market, to increase at a rate of 505,000 units. Sales climbed 9.1 percent over the same period in 2014.
Despite signs of loss of momentum, the rise in new home sales will help allay concerns of a sudden slowdown in activity following a report of a surprising drop in home resales.
The National Association of Realtors revealed that sales of previously owned homes plunged 10.5 percent in November. Economists and realtors attributed the significant drop in home resales to new regulations which delay contract closings.
New home sales are counted once contracts are signed, implying that they were not affected by the new mortgage disclosure policy that lengthened the closing time for purchase contracts.
New home sales climbed 4.5 percent in the South and soared 20.5 percent in the Midwest. However, sales declined 8.6 percent in the West, while falling 28.6 percent in the Northeast.
The market saw the inventory of new homes increase 2.2 percent to 232,000 units in November, or the highest since January 2010. But while construction has been ramped up by builders, new home supply remains significantly lower than what was recorded during the height of the housing boom.
Romesh Navaratnarajah, Senior Editor at PropertyGuru, edited this story. To contact him about this or other stories email romesh@propertyguru.com.sg
