U.S. new single-family home sales rose in July to their highest level in about a year and a half. Home builders continue to benefit from limited supply in the second-hand home market, it said.
Key Point New single-family home sales (seasonally adjusted, annualized) rose 4.4% month-on-month to 714,000 units Median market forecast compiled by Bloomberg was 703,000 units Last month’s forecast was 684,000 units (preliminary figure of 690,000 units) 7,000 units)
With mortgage rates soaring to their highest levels in nearly two decades, most homeowners are reluctant to sell their homes and move. This has led to a shortage of inventory in the existing home market, leading potential buyers to seek out new properties. Builders are also expanding incentives for buyers.
But the recent acceleration in mortgage rates has dampened confidence among homebuilders. Data released on Monday by the National Mortgage Bankers Association (MBA) showed 30-year fixed mortgage rates rose 15 basis points to 7.31% in the week ended Friday. This is the highest level since the late 2000s. The home application index fell for the sixth straight week to its lowest level since 1995.
US 30-Year Fixed Mortgage Rate Rises to 7.31%, Highest Since 2000
A combination of tight supply and high borrowing costs pushed the median selling price of new homes to $436,700, up from the previous month. Although it fell 8.7% from the same month last year, it is still well above the level before the COVID-19 pandemic.
The number of properties sold but not started, one of the indicators of the backlog of orders, fell to its lowest level this year.
As of the end of July, 437,000 units were on sale, up 2.1% from the previous month. The inventory-to-sales ratio was 7.3 months, the lowest since early 2022.
By region, the Midwest and West recorded their highest levels since early last year. Decreased in the Northeast and South.
See table for detailed statistics.
Original title:US New-Home Sales Rise to Highest Level in Over a Year (2)(excerpt), US July New Home Sales Rose to 714k; Est. 703k (excerpt)
2023-08-23 16:02:00
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