The annual pace of new home sales strengthened last month. The Northeast led the rise, though the Midwest was close behind.
During the first month of this year, the sale of 41,000 new privately owned residential housing units was successfully completed.
Activity accelerated from 38,000 in the final month of last year and an upwardly revised 39,000 units sold in January 2016.
The statistics were jointly reported Friday by the Census Bureau and the Department of Housing and Urban Development.
The seasonally adjusted annual rate of new home sales worked out to 555,000 in January 2017. The rate increased from a downwardly revised 535,000 a month earlier and an upwardly revised 526,000 a year earlier.
“This increase in new home sales is in line with our forecast for a steady, gradual recovery of the housing market,” National Association of Home Builders Chairman Granger MacDonald said in a written statement. “However, the pace of growth may be hampered by supply-side headwinds, such as shortages of lots and labor.”
NAHB Chief Economist Robert Dietz added that new home sales are expected to increase further this year as the supply of existing homes remains tight and consumers turn to new construction.
In the Northeast, the annual rate of new home sales last month was 44,000, rising from December 2016 by 16 percent — the largest month-over-month increase of any region. Next was the Midwest, where the rate climbed 15 percent to 70,000. The South was up 4 percent to a 290,000 rate.
Only the West suffered a decline from December: 4 percent to 151,000.
At the end of January 2017, there were a seasonally adjusted 265,000 new U.S. homes for sale, rising 4 percent from the prior month and expanding 11 percent from a year prior.
At the current pace of sales, it would take 5.7 months to clear out the current inventory.
Last month’s median sales price was $312,900, while the average price was $360,900.
