New home sales data released this week showed that sales were 16.6% higher than March when comparing the seasonally adjusted annualized rates, and 23.8% higher than last year.
This news comes from estimates released jointly by the U.S. Census Bureau and the Department of Housing and Urban Development.
The median sales price of new houses sold in April 2016 was $321,100; the average sales price was $379,800. The seasonally adjusted estimate of new houses for sale at the end of April was $243,000. This represents a supply of 4.7 months at the current sales rate.
“At last we have a clear, statistically significant view that the new home market is having its best spring buying season in a decade,” says Realtor.com® chief economist Jonathan Smoke. “April’s non-seasonally adjusted volume of new home contracts was estimated to be 61,000, which was the highest April volume since 2007. However, a key difference between now and 2007 is that 38 percent of the new homes sold then were completed speculative inventory. In April, less than 30 percent of new homes sold were completed. Likewise, the supply of new homes for sale in 2007 was 7.4 months. This April’s new home supply was 4.7 months – solidly below normal. It appears that the growth in sales is coming from higher price points, indicating that builders are finding success with move-up, luxury, and active adult home buyers rather than entry level buyers. Hopefully this will free up existing home owners to sell their lower priced homes as they move up.”
Quicken Loans Vice President Bill Banfield stated, “The spring home buying season is in full swing as builders have been picking up steam through the first quarter. While the large jump in new home sales is encouraging, I would look for a normalization in the coming months that shows a slow but steady increase in the health of the housing market.”