Census and HUD reported Wednesday new homes sales for October rebounded from their unexpected low in September to a level of 495,000 on an annual basis. This is a 10.7 per cent increase from the revised September, a 1.6 per cent increase from the 3Q average and a 15.7 per cent increase in year-to-date not seasonally adjusted levels from last year.
Existing home sales, as reported by the National Association of Realtors Tuesday, decreased 3.4 per cent in October, and the annual share of first-time buyers in 2015 fell to its second-lowest level since the survey was launched in 1981. Total existing home sales in October decreased to a seasonally adjusted rate of 5.36 million units combined.
October existing sales were up 3.9 per cent from the same period a year ago.
US New Home Sales: October 2015
Regionally, only the West experienced an insignificant decline of 0.9%.
Inventory also increased 1.3% to 226,000, the highest level since March 2010. At the current sales pace, the inventory would be sold off in 5.5 months. The increase was particularly strong in homes not yet started now at their highest since late 2008. The addition of inventory continues in the face of builders’ difficulty obtaining lots and labor. The increase in the inventory of not yet started homes is encouraging that builder are finding lots but may be waiting for a buyer before starting the home.
The median sales price fell almost 6% as sales in the $200,000 to $300,000 range picked up, which is likely an indication that first time buyers are returning to the market.
US Existing Home Sales: October 2015
Existing sales were flat in the Northeast and fell 0.8% in the Midwest, 3.2% in the South 8.7% in the West. Year-over-year, all four regions increased, ranging from 8.6% in the Northeast and 8.3% in the Midwest to 2.7% in the West and 0.5% in the South.
Total housing inventory decreased by 2.3% in October, and is 4.5% below its level a year ago. At the current sales rate, the October unsold inventory represents 4.8-month supply, compared to a 4.7-month supply in September. One-third of homes sold in October were on the market for less than a month.
The distressed sales share fell to 6% in October, the lowest since the series began in October 2008. Distressed sales are defined as foreclosures and short sales sold at deep discounts. The October all-cash sales share remained unchanged at 24% in October, compared to 27% a year ago. Individual investors purchased a 13% share in October, unchanged from September but down from 15% during the same month a year ago.
The October median sales price of $219,600 declined to the lowest level since April, but was 5.8% above the same month a year ago, and represented the 44th consecutive month of year-over-year price increases. The median condominium/co-op price of $207,100 in October was up 1.6% from the same month a year ago.