New Home Sales Down -6.1% From a Year Ago

The February 2016 New Residential Single Family Home Sales increased by 2.0%.  Don't get too excited as the ±18.8% error margin is way larger than the actual monthly gain.  Monthly sales increased by 10,000 annualized units to 512,000 for the month.  Annual sales have contracted by -6.1%.  Sales were 545,000 a year ago.  The annual -6.1% sales change has a ±17.9% error margin.  In this Census survey, amounts are annualized and represent what the yearly volume would be if just that month's rate were applied to the entire year.  These figures are also seasonally adjusted.  Many in the press are saying this gain is great news.  We don't, and more suspect the economy is slowing, people are already tapped out and cannot afford the soaring home prices and the monthly gain will probably be revised away next month.


New Home Sales


The February 2016 average home sale price was $348,900.  This is a -4.0% monthly decrease.  That still is a very high amount of money as the average new home price.  From a year ago the average price has decreased 2.0%.


average new home price


The median home price is $301,400,  This is a whopping 6.2% increase from the previous month.  For the year, the median new home sales price has increased a 2.6%.   Median means half of new homes were sold below this price and both the average and median sales price for single family homes are not seasonally adjusted.


median new home price


Inventories:   New homes available for sale is now 240,000 units, a 1.7% increase from last month.  From a year ago inventories have increased 17.6% and this is outside the ±6.2% margin of error.  The monthly error margin is ±1.9%.


new homes for sale


The graph below shows how long it would take to sell the new homes on the market at each month's sales rate.  For February, the time stands at 5.6 months.  This is no change from last month and a 24.4% annual one.


new home inventory


The median time a house was completed and on the market to the time it sold was 3.8 months.  From a year ago that time period was 3.3 months.  The median time to move new properties is fairly stable but this is an uptick.


New Home Sales time on market


The reason February had any increase is the western part of the United States.  Sales in the West soared by 38.5% while monthly sales in the Northeast declined by -24.2%, in the Midwest dropped by -17.9% and in the South declined by -4.1%.  Overall it seems that shelter and housing is just unaffordable for most.  That was a similar scenario in 2006, although at that time rents were not soaring as well.



The Census notes that the average revision is about 5% of the original reported.  Here are our overviews of residential real estate statistics, only some graphs revised.

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