Sales of new homes in the United States soared in November, defying higher mortgage rates, but they’re still below year-ago levels. The US Commerce Department said Thursday that new-home sales jumped +17% in November from the previous month to a seasonally adjusted annual rate of 657,000. The November figure remained -7.7% below the November 2017 rate, according to new statistics published by the US Census Bureau and the US Department of Housing and Urban Development.
Despite the healthy gain, sales remained 7.7 percent below the pace from a year ago.
• Prior was 544,000 • +16.9% (-8.3% prior) • Median price -11.9% year/year • Months supply 6.0 vs 7.0 prior • Homes for sale 330K vs 328K prior
Sales increased by +15% between November 2017 and November 2018 in the Northeast, while declining by -2.5% in the Midwest, -0.8% in the South, and -26% in the West.
Sales of existing homes plunged in December and were -3.1% in 2018 than the previous year.
Steady price gains, higher borrowing costs, and a limited supply of available houses have discouraged many would-be buyers. The housing market stumbled badly at the end of 2018 as mortgage rates reached a seven-year high near 5 percent.
- Homebuilders’ stocks gain strongly after new home sales reached a nine-month high in November, and October’s number was revised upward.
- iShares Home Construction ETF (ITB +2.8%), while boasting a 12% return in the past month, is still down 22% over the past year.
- Notable names on the move–D.R. Horton (DHI +3%), KB Home (KBH +3.3%), PulteGroup (PHM +3.2%), Toll Brothers (TOL +3.2%), Lennar (LEN +2.8%), and Beazer Homes (BZH +3.9%).