Steel Markets

New Home Sales Jump in November

January 30, 2019

Sales of new homes soared in November to a seasonally adjusted annual rate of 657,000, according to data from the U.S. Census Bureau and the Department of Housing and Urban Development. Sales increased 16.9 percent from October, but dropped 7.7 percent from the November 2017 estimate.

The median sales price for new homes was $302,400 and the average sales price $362,400. Inventory stood at 333,000 units at the end of November representing a supply of 6.0 months at the current sales rate. Inventory declined 14.3 percent from October and was 22.4 percent higher than a year ago.

Regionally, sales jumped 100 percent in the Northeast, 30.4 percent in the Midwest and 20.6 percent in the South. The West was the only region not to report an increase in sales, falling 6.9 percent in November.

The recent shutdown delayed the report by Commerce and has a 20 percent margin of error, making it subject to revision in the next report.

“I think it is especially important to put the last two months’ readings in context because neither of them is likely to be an accurate indicator of the current demand for new homes,” said Stephen Stanley, chief economist for Amherst Pierpont Securities as quoted by MarketWatch. “The October figure was depressed and the November count included some makeup for activity that was disrupted in the prior month. The two-month average is 610K, which is remarkably similar to the June-September average of 608K. That pace represents a bit of a downshift in new home sales from early in the year, but we are on track for new home sales for all of 2018 to come in around 625K, slightly above the 2017 count of 613K.”