Steel Markets

New Home Sales Strongest in 12 Years

November 26, 2019

New home sales in October dipped slightly from September, down 0.7 percent to a seasonally adjusted annual rate of 733,000, according to the U.S. Census Bureau and the U.S. Department of Housing and Urban Development. The dip, however, occurred after the September sales estimate was revised upward to 738,000 from 701,000. Sales for the past two months have been at the highest pace in more than 12 years.

Sales on a year-over-year basis jumped 31.6 percent from the estimate of 557,000 in October 2018.

The median sales price in October was $316,700 and the average sales price $383,300.

“Forty-five percent of homes sold in October were priced below $300,000, which is an indication that more millennial buyers are taking advantage of low mortgage rates and entering into the marketplace,” said National Association of Home Builders Chairman Greg Ugalde.

An estimated 322,000 new homes were for sale at the end of October representing a supply of 5.3 months at the current sales rate.

“For-sale inventory remains tight as this marks the third consecutive month below a six-month supply,” said Danushka Nanayakkara-Skillington, NAHB’s Assistant Vice President of Forecasting and Analysis. “The low inventory rates show there is a need for added construction to meet growing demand.”

On a month-over-month basis, sales fell 18.2 percent in the Northeast and 3.3 percent in the South. Sales increased 4.2 percent in the Midwest and 7.1 percent in the West.