July New-Home Sales Rebound Slightly From Weak June
|August 27, 2007|
Sales of new single-family homes were up 2.8 percent in July to a seasonally adjusted annual rate of 870,000 units as new-home sales rebounded from weak sales figures in June, the U.S. Commerce Department reported today. The July sales pace was 10.2 percent below a year earlier.
“Despite their normal volatility, these numbers are promising,” said Brian Catalde, president of the National Association of Home Builders (NAHB) and a home builder from El Segundo, Calif. “Today’s headlines would make you think that no one is buying, or can buy, new homes. That is far from the case. Financing is still available, builders are offering plenty of choices in a variety of price ranges and people are still buying the homes of their dreams.”
“Home builders have been trimming prices and offering nonprice sales incentives to bring reluctant home buyers back into the market, and their efforts have brought results, at least for the short term,” said NAHB Chief Economist David Seiders. “However, the tightening of lending standards and problems in the financial sector, which deepened this month, will delay housing’s recovery at least until mid- to late-2008.”
The inventory of new homes for sale edged down slightly to 533,000 in July and the equivalent months’ supply at the July sales pace was 7.5 months, down from 7.7 months in June.
Completed homes for sale were 33 percent of the inventory, while units still under construction represented 51 percent of the inventory and units for-sale that were permitted but not yet started represented 16 percent of the inventory level — essentially no change from the previous two months. The median length of time that completed homes were on the market was 6.1 months in July, up from 5.9 months in May.
Regionally, new-home sales in July were up by 22.4 percent in the West and 0.6 percent in the South. Sales were down by 24.3 percent in the Northeast and 0.9 percent in the Midwest.