ARLINGTON, Va.—New-home sales fell slightly in October to 733,000 annualized units from September's upwardly revised 738,000 units. Despite the dip, the month's sales were 31.6% higher than last year.
"Even with the mild decline last month, sales are up over 30% from the prior year," said NAFCU Chief Economist and Vice President of Research Curt Long. "According to Freddie Mac, the average 30-year fixed mortgage rate has fallen by over a full percentage point over that time. This has recharged the refinance market, but home sales are also clearly benefitting."
Long also noted that construction activity remains strong, following housing permits hitting a 12-year high last month.
"There is a lot to feel good about in the housing market, and NAFCU sees no reason why the good times cannot continue in 2020," he added.
Sales increased in two of the four regions in October: in the West 7.1% followed by the Midwest (+4.2%). Sales fell 18.2% in the Northeast and 3.3% in the South during the month.
All of the regions saw significant year-over-year growth in new-home sales: the South (+40.6%), West (+21.9%), Northeast (+17.4%), and Midwest (+17.2%).
Based on current month sales, there were 5.3 months of supply in October, up slightly from September. The number of unsold homes left on the market grew from 323,000 to 327,000 units. This represents a 2.4% decrease from a year ago, Long said.