December 24 2010 (Brian Moore)
The Department of Housing and Urban Development (HUD) and the U.S. Census Bureau reported that sales of new homes increased by 5 percent in November 2010 compared to October. New home sales rose to an annualized rate of 290,000 units from 275,000 units in October.
The information for the survey is based on a sample of houses selected from building permits. Since a “sale” is defined as a deposit taken or a sales agreement signed, this can occur prior to a permit being issued. It also accounts for why this data is usually adjusted every month.
Analysts were expecting the number of units sold to be 300,000, but feel that the amount sold is not outside a reasonable deviation, especially considering the amount of competition new homes face against an increasing amount of lower priced distressed properties entering the housing market.
The number of new homes sold is still far below the 368,000 homes sold in November 2009.
The one bright spot of the report is that the median sales price for new house sold in November was $213,000, up from $197,200 in October, but still 2.7 percent lower than November 2009’s median sales price of $218,000.
Analysts also noted that new home inventory is at a near record low which should make it easier to knock down the current 8.2 months supply of inventory down when sales start to pick up.
Tags: hud, new home sales, median sales price, new home inventory, housing market, distressed properties