by Bill McBride on 9/25/2013 10:00:00 AM
Wednesday, September 25, 2013
The Census Bureau reports New Home Sales in August were at a seasonally adjusted annual rate (SAAR) of 421 thousand. This was up from 390 thousand SAAR in July (July sales were revised down from 394 thousand).
May sales were revised down from 439 thousand to 429 thousand, and June sales were revised down from 455 thousand to 454 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 August 2013 were at a seasonally adjusted annual rate of 421,000, according to estimates released jointly today by the U.S. Census Bureau and the Department of Housing and Urban Development. This is 7.9 percent above the revised July rate of 390,000 and is 12.6 percent above the August 2012 estimate of 374,000."Click on graph for larger image in graph gallery.
The second graph shows New Home Months of Supply.
The months of supply decreased in August to 5.0 months from 5.2 months in July.
The all time record was 12.1 months of supply in January 2009.
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 August was 175,000. This represents a supply of 5.0 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.
This graph shows the three categories of inventory starting in 1973.
The inventory of completed homes for sale is near the record low. The combined total of completed and under construction is increasing, but still very low.
The last graph shows sales NSA (monthly sales, not seasonally adjusted annual rate).
In August 2013 (red column), 35 thousand new homes were sold (NSA). Last year 31 thousand homes were sold in August. The high for August was 110 thousand in 2005, and the low for August was 23 thousand in 2010.
This was slightly below expectations of 425,000 sales in August, and a weak report including the minor downward revisions to prior months. I'll have more later today.