Wednesday, July 24, 2013

New Home Sales at 497,000 Annual Rate in June

by Bill McBride on 7/24/2013 10:00:00 AM

The Census Bureau reports New Home Sales in June were at a seasonally adjusted annual rate (SAAR) of 497 thousand. This was up from 459 thousand SAAR in May (May sales were revised down from 476 thousand).

March sales were revised down from 451 thousand to 443 thousand, and April sales were revised down from 466 thousand to 453 thousand. 

The first graph shows New Home Sales vs. recessions since 1963. The dashed line is the current sales rate.

"Sales of new single-family houses in June 2013 were at a seasonally adjusted annual rate of 497,000, according to estimates released jointly today by the U.S. Census Bureau and the Department of Housing and Urban Development. This is 8.3 percent above the revised May rate of 459,000 and is 38.1 percent above the June 2012 estimate of 360,000."
New Home SalesClick on graph for larger image in graph gallery.

The second graph shows New Home Months of Supply.

The months of supply decreased in June to 3.9 months from 4.2 months in May.

The all time record was 12.1 months of supply in January 2009.

New Home Sales, Months of Supply This is now in the normal range (less than 6 months supply is normal).
"The seasonally adjusted estimate of new houses for sale at the end of June was 161,000. This represents a supply of 3.9 months at the current sales rate."
On inventory, according to the Census Bureau:
"A house is considered for sale when a permit to build has been issued in permit-issuing places or work has begun on the footings or foundation in nonpermit areas and a sales contract has not been signed nor a deposit accepted."
Starting in 1973 the Census Bureau broke this down into three categories: Not Started, Under Construction, and Completed.

New Home Sales, InventoryThis graph shows the three categories of inventory starting in 1973.

The inventory of completed homes for sale is at a record low. The combined total of completed and under construction is also just above the record low.

The last graph shows sales NSA (monthly sales, not seasonally adjusted annual rate).

In June 2013 (red column), 48 thousand new homes were sold (NSA). Last year 34 thousand homes were sold in June. The high for June was 115 thousand in 2005, and the low for June was 28 thousand in 2010 and 2011.

New Home Sales, NSA

This was above expectations of 481,000 sales in June, and a solid report even with the downward revisions to previous months.  I'll have more later today.

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