New residential home sales were up substantially from a year ago in August, and new housing inventory continued to stabilize.
By Peter Ricci
New residential home sales increased 27.7 percent year-over-year in August to a seasonally adjusted annual rate of 373,000, according to the latest joint report from the U.S. Census Bureau and the Department of Housing and Urban development.
From July to August, the data was a bit more modest, with new residential home sales falling slightly by 0.3 percent percent from July’s revised rate of 374,000, which was revised upwards from the Census Bureau’s original number of 372,000.
New Residential Home Sales and Median Sale Price
The Census Bureau also reported on a number of other interesting stats relating to new residential home sales, among them:
- The median sale price for new single-family homes sold in August was $256,900, which is an increase of 14.6 percent from July.
- The average sale price, which was $295,300 in August, was of a similar increase, rising 12.2 percent from July.
The Importance of New Housing Inventory
Of course, the other important important stat in the Census Bureau’s report was the inventory of new residential homes, and it didn’t disappoint – there were 141,000 new houses for sale at the end of August, which is a 4.5-months supply and very encouraging for housing inventory; anything less than a six-months supply is considered normal by analysts.
To put things into perspective, new housing inventory skyrocketed following the bursting of the housing bubble, and in January 2009, it peaked at an incredible 12.1-months supply; so, August’s 4.5 months, which is actually a slight decline from the 4.6 months of July, represents a dramatic absorption of excess housing inventory by the market, and is a solid indicator for just how far housing has traversed since 2008.
Also, this is the second promising statistic on housing inventory in as many weeks; last week, we reported on the inventory of existing-home sales, which has fallen 18.2 percent in the last year and has similarly corrected. Slowly but surely, housing is making its way back.