Steel Markets

New Home Sales Increase for Second Month

Written by Sandy Williams

Sales of new single-family houses rose 3.7 percent from November to December to a seasonally adjusted rate of 621,000, says the latest report by the U.S. Census Bureau and the Department of Housing and Urban Development. November’s data was revised downward to 599,000 homes sold from a previously reported rate of 657,000. Sales fell 2.4 percent compared to December 2017.

“Despite a period of weakness during the fall of 2018, new home sales ended 2018 up 1.5 percent compared to the total for 2017,” commented National Association of Home Builders economist Robert Dietz.

The median sales price in December was $318,600 and the average sales price $377,000.

Inventory at the end of December was 344,000, a supply of 6.6 months at the current sales rate.

Sales in December increased in all regions except the Midwest, which fell 15.3 percent. Sales in the Northeast jumped 44.8 percent from 29,000 units to 42,000. Sales in the South increased by 5 percent and in the West by 1.4 percent.

“The big picture here is that sales are recovering from the 549,000 low in October, when activity likely was depressed by Hurricane Michael,” Ian Shepherdson, chief economist at Pantheon Macroeconomics, said in a note to clients.

“The increase in mortgage applications last fall is starting to work through the numbers, and we expect further increases in sales—with an even-money chance of new cycle highs—in the spring,” he added.

Data collection and processing were delayed for the December report due to the partial government shutdown in December and January. The January report will be released on March 14.

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