ARLINGTON, Va.—August's 7.1% increase in new-home sales are pointing to a resilience in the market. In particular, lower mortgage rates have supported sales, and NAFCU's Curt Long said higher inventory will "sop up some of the supply shortages in the existing market."
Long, NAFCU's chief economist and vice president of research, also noted strong upward revisions to the June (+80,000 units) and July (+30,000) sales data.
“Large revisions are common in the new home sales data, and the combined increase represents 16% of total sales during those months,” Long said. “Add it all up, and the picture of the new homes market shows a solid upward trend over the past 10 months.”
Sales rose in the West (+16.5%) and in the South (+6%), while the Northeast (-5.9%) and Midwest (-3%) saw sales fall throughout the month.
South, West Lead the Way
August saw 18% year-over-year growth in total, with sales in the South (+24.9%) and West (+17.9%) rising from a year ago. Elsewhere, the Midwest saw a fall in new home sales (7.2%) from August 2018; the Northeast saw no change.
Long said that inventory decreased during the month (from 5.9 months of supply to 5.5), but remains relatively higher than existing-home sales. The median home price rose from $305,400 in July to $328,400 in August.