Mar 27, 2012 | Housing Analysis
Sales of “new homes” fell to the lowest levels in four months last month.
According to the Census Bureau’s monthly New Home Sales report, 313,000 new homes were sold in February 2012 on a seasonally-adjusted, annualized basis, representing a 1.6% drop from the month prior.
A “new home” is a home for which there has been no prior owner nor tenant.
At first glance, the data looks negative for the housing market; a suggestion that the well-publicized housing market recovery may be slowed. However, within February’s New Home Sales report are three important counter-statistics worth mentioning.
First, although annualized home sales volume slipped 5,000 units in February, this occurred as the number of homes for sale nationwide remained constant at 150,000. This is the fewest number of new homes for sale since at least 1993 — the first year that the Census Bureau tracked such data.
A small home supply promotes rising home values when buyer demand is rising and, in February, buyer demand held firm.
A second reason to remain optimistic on housing is that New Home Supply was 5.8 months in February. This means that, at the current pace of sales, the entire new home inventory (more…)
Feb 28, 2012 | Housing Analysis
The new construction market rolls on.
As foreshadowed by February’s Homebuilder Confidence survey, which rose to a 4-year high, the Census Bureau reports new homes are selling more quickly than builders have built them, lowering the national “home supply” to levels not seen since 2006.
A “new home” is a home that is considered new construction and, at the current pace of sales, the nation’s entire new home inventory of 151,000 homes would be sold in 5.6 months.
Anything less than 6.0-month supply is thought to connote a “sellers’ market”.
321,000 new homes were sold last month on a seasonally-adjusted, annualized basis. 7 of 10 new homes sold for less than $300,000.
The South Region continues to account for the majority of new construction sales, posting a 59% market share in January. South Region sales were up 9 percent as compared to December. The other 3 regions turned in mixed results.
- Northeast Region : +11.1% from December 2011
- Midwest Region : -24.5% from December 2011
- West Region : -10.6% from December 2011
Unfortunately, the Census Bureau’s New Home Sales data could be wrong.
Although New Home Sales were said to fall by about (more…)
Jan 31, 2012 | Housing Analysis
New Home Sales slowed into the New Year but the market for newly-built homes remains strong. For home buyers in Worcester County area and nationwide, December’s New Home Sales report is yet one more signal that the housing market recovery may be underway.
According to the Census Bureau, the number of new homes sold in December 2011 slipped 2 percent to 307,000 units on a seasonally-adjusted, annualized basis nationwide.
A “new home” is a home that is considered new construction; a home for which the buyer will be the first owner and tenant.
As compared to December 2010, last months’ sales volume fell seven percent. It’s a statistic that suggests housing market weakness. However, in looking at a different component of the New Home Sales report — the supply of homes for sale — we’re forced to reconsider.
At the current pace of sales, every new home for sale nationwide would be “sold” in a matter of 6.1 months.
Economists believe that a 6.0-month supply defines a market in balance — anything quicker is termed a “seller’s market”. Statistics like that are enough to create urgency among today’s Worcester County area home buyers.
Unfortunately, the Census (more…)
Jan 20, 2012 | Housing Analysis
When it comes to housing data, sometimes you have to look past the headlines. December’s Housing Starts data offers a terrific illustration of why.
Each month, the Census Bureau tallies Housing Starts for the month prior. A “housing start” is a home on which construction has started.
The Housing Starts report is separated by property type. There is a count for single-family homes; a count for 2-4 unit homes; and a count for buildings of 5 units or more, a category including apartments and condominiums.
In December, as reported by the government, Housing Starts fell 4 percent nationwide overall. This runs contrary to recent strength in housing and the story was quickly picked up by the press :
- U.S. Housing Starts Fall More Than Forecast (BusinessWeek)
- U.S. Housing Starts Fall (MarketWatch)
- December Housing Starts Are Worse Than Expected (Fox Business)
Now, although these headlines are factually true, they’re also are a little bit misleading.
Housing Starts did fall 4 percent last month but that was for all Housing Starts, across all three property types. Data like this is somewhat irrelevant to home buyers in Massachusetts or anywhere else nationwide.
Few buyers purchase 2-4 unit homes, (more…)
Dec 28, 2011 | Housing Analysis
New home inventory is approaching bull market territory.
According to the Census Bureau, the number of new homes sold rose 2 percent in November. On a seasonally-adjusted, annualized basis, home buyers bought 315,000 newly-built homes last month.
November’s New Home Sales data marks the 4th straight month of rising sales volume, lifting the housing-market metric to a 7-month high, and adding to the housing market’s recent show of strength.
Last week, we learned that Existing Home Sales also climbed in November.
The big story in the New Home Sales report, though, is the remaining new home supply nationwide.
With just 158,000 homes “on the market” and the pace of home sales hastening, the complete, national inventory of “new homes” would now be sold in just 6.0 months, a 0.2-month improvement from October. This is the quickest home sales pace in (more…)
