Sept. 27, 2012 – NAFCU Chief Economist David Carrier said August’s rise in new-home prices was good news for the housing industry and the economy, but it’s too early to call it a trend.
August sales of new homes remained flat from the previous month, however prices were up significantly, rising 11.2 percent from July’s figures and 17 percent from last August. This is the first major price increase since February, the data show.
“The volume of new homes sold fluctuates quite a bit, and average prices are affected by the property values in the mix of homes being sold,” said Carrier. “But the fact that the homebuilder confidence index is seeing significant increases over the past few months is reason for optimism that home building may have finally turned a corner.”
The August data, released Wednesday by the Commerce Department, showed new-home sales down 0.3 percent from a revised 374,000 units in July, annualized, to 373,000; this represents a 27.7 percent increase from a year ago. Three of the four regions showed sales increases for the month, and all four regions saw substantial increases in their year-over-year sales.
The months of available inventory remained level at 4.5 months of supply, and the median new-home price, non-seasonally adjusted, rose from $231,100 in July to $256,900 in August, up from $219,600 one year ago.
For more, see NAFCU’s Macro Data Flash on new-home sales.