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July was a good month for new-home sales. That’s according to the U.S. Census Bureau and the Department of Housing and Urban Development’s new-home sales report, released on Tuesday morning.
New-home sales in July were at a seasonally adjusted annualized rate of 507,000, an increase of 5% over June’s (downwardly revised) numbers, 481,000.
Sales varied by region. Not much happened in the Midwest, year over year in July; some 54,000 homes were sold in both periods. But there was an increase in the Northeast, to 32,000 from 23,000; in the South, from 228,000 to 294,000; and in the West, from 98,000 to 127,000. (Is Denver driving those numbers in the West? Could be.)
And though we learned last week that single-family starts were up in July, inventory is now, and will be, tight; right now it’s at 5.2 months of supply.
Thus, prices went up, too. The median new-home price, $285,900 in July, increased for the first time since February. This, says Jonathan Smoke, chief economist of realtor.com®, “is a hint that part of the lack of growth is a result of builders not fully offering more options at affordable price points.”
Builders, take note: The new-home market will not recover to more normal levels, Smoke says, without embracing the entry level.
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