Despite a spike in new home construction, the rate of new home sales weakened last month. The Midwest led the decline.
Residential property buyers completed the purchase of a preliminary 45,000
new U.S. houses during all of October 2016.
Sales matched the downwardly revised level the prior month and accelerated from a downwardly revised 39,000 a year prior.
Historical data from the Census Bureau and Department of Housing and Urban Development, which jointly released the latest numbers Wednesday, indicate that there were 483,000 new home sales from Jan. 1, 2016, through Oct. 31.
The report indicated that the seasonally adjusted annual rate of new home sales
was 563,000 last month. The rate fell from the downwardly revised 574,000 in September but was stronger than the downwardly revised 478,000 in October 2015.
The drop in new home sales came even as the annual rate of
new home construction soared 26 percent from the previous month to 1.323 million last month.
“Though slightly down from last month, new home sales have been on an upward trend since last year,” National Association of Home Builders Chairman Ed Brady said in an announcement.
A 14 percent month-over-month decline in the Midwest was the worst of any region and put the seasonally adjusted annual rate at 63,000 there during October 2016. Sales fell 9 percent in the Northeast to an annual rate of 30,000, and the South saw the rate fall 3 percent to 322,000.
But new home sales in the West jumped 9 percent to a seasonally adjusted annual rate of 148,000.
The report indicated that a seasonally adjusted 246,000 new U.S. homes
were for sale as of Oct. 31, 2016. The inventory was up 3 percent from a month earlier and 9 percent from a year earlier.
“Builders are adding to inventory based on consistent gains in sales, solid builder confidence and ongoing job and economic growth,” NAHB Chief Economist Robert Dietz stated in the trade group’s news release.
A 5.2-month supply was reported by the Census Bureau as of last month.
The median price of new homes sold in October was $304,500, and the average price was $354,900.
