Home sales plummet, inventory is up!

The latest new-home sales report from the U.S. Census Bureau and the U.S. Department of Housing and Urban Development, revealed that new single-family home sales in July came in at a seasonally adjusted annual pace of 511,000 units. That’s down 12.6% monthly and 29.6% annually, falling to the lowest new-home sales rate in six-and-a-half years.

New-home sales have plunged since peaking at a seasonally adjusted annual rate of 993,000 units in January 2021. In July 2022, only 8% of new-home sales were priced below $300,000, compared to 22% one year ago. July 2019, 47% of new-homes sales priced below $300,000.

Year to date, new-home sales are 15.7% below the pace set during the same time frame last year. Builders, consequently, have slowed their construction immensely, with single-family starts plummeting to a 17-month low. The slowdown has helped to temper home-price growth. The median price for new homes rose 5.9% monthly and 8.2% yearly to $439,400. For context, the pandemic-era high in annual price gains was 24.2%, seen in August 2021.

One silver lining in the sales data is that the thaw in sales has helped the inventory of new homes recover to levels unseen for more than a decade. The number of new homes for sale at the end of July was estimated at 464,000, the most since first-quarter 2008. At the current sales pace, this translates to 10.9 months of supply, up 81.7% from one year ago.

Source: https://www.scotsmanguide.com/browse/content/newhome-sales-plummet-to-lowest-rate-since-2016 By Arnie Aurellano, Editor, Scotsman Guide