January New Residential Single Family Home Sales soared 15.6%, or 437,000 annualized sales. Single family new home sales have not been this high since July 2008. Housing inventory is at a 4.1 month supply. Inventories haven't been this low since March 2005. Beware of this report for most months the change in sales is inside the statistical margin of error and will be revised significantly in the upcoming months.
New single family home sales are now 28.9% above January 2012 levels, but this figure has a ±21.7% margin of error. A year ago new home sales were 339,000. Sales figures 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 seasonally adjusted as well.
The Northeast region saw a 27.6% monthly increase in new single family home sales with an error margin of ±97.9%. In other words, the error margin is so large, the monthly percentage increase in the Northeast is assuredly wrong for January. The Midwest region saw a monthly new home sales surge of 11.1% but has a ±42.9% margin of error. That's almost a 50-50 chance of being right. Bottom line this report has a lot of statistical noise.
The average home sale price was $286,300, a -5.0% drop from last month's average price of $301,500. If one thinks about it, these prices are outside the range of what most wages can afford.
January's median price dropped -9.4%, from $249,800 to $226,400. Median means half of new homes were sold below this price and both the average and median sales price for single family homes is not seasonally adjusted.
Inventories are hitting record lows. The current supply of new homes on the market would now take 4.1 months to sell, a -14.6% decline from last month's 4.8 months to sell. The amount of new homes for sale was 150,000 units, annualized and seasonally adjusted. From a year ago housing inventory has declined -22.6% and is above the margin of error of ±14.1%.
Below is a graph of the months it would take to sell the new homes on the market at each month's sales rate. We can see these inventories vs. sales times have plunged in a nose dive, even from a year ago.
The median time a house was completed and on the market for sale to the time it sold was 4.7 months, an increase from December's 4.6 months.
The variance in monthly housing sales statistics is so large, in part, due to the actual volume declining, along with the fact this is a survey. One needs to look at least a quarter to get a real feel for new home sales, but a year of sales data is more in order. Additionally this report, due to it's huge margin of error, is almost always revised significantly the next month. Buyer beware on month to month comparisons and reacting to primarily figures and why we graph up the statistics so one can identify a real trend versus press headline buzz.
What we know for certain about new homes sales are increasing from the year ago change. We also know inventories have plunged. Finally, we also see new single family home prices becoming out of reach for most families by income again. We list the margins of error for they are usually above the monthly reported percentage changes. The Census notes that the average revision is about 5% of the original reported.
Here is our overviews of residential real estate statistics, only some graphs revised.