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Sales of US New Homes Up in March

Sales of US new homes rose to a seasonally adjusted annual rate of 692,000 units in March 2019.

The figures released by the US Department of Housing and Urban Development and the U.S. Census Bureau for US new homes represents the highest sales pace since November 2017.

US new home sales occur when a sales contract is signed, or a deposit is accepted from either American nationals or overseas property investors. The home can be in any stage of construction: not yet started, under construction or completed.

In addition to adjusting for seasonal effects, the March reading of 692,000 units is the number of US new homes that would sell if this pace continued for the next 12 months.

The inventory of US new homes for sale was 344,000 in March, representing a six months’ supply. The median sales price was $302,700 with strong gains in homes sold at lower price points. The median price of a new home sale a year earlier was $335,400.

Regionally, and on a year to date basis, new US home sales fell 17.6 per cent in the Northeast, 8.1 per cent in Midwest and 5.9 per cent in the West. Sales rose 9.6 per cent in the South, where 58 per cent of new home sales occurred in March.

Greg Ugalde, chairman of the National Association of Home Builders, commented: ‘These numbers indicate that builders who can produce housing at affordable price points will experience sales growth. However, builders are still dealing with a shortage of construction workers and buildable lots, which limits housing affordability.’

NAHB Chief Economist Robert Dietz said: ‘We saw a large gain at lower price points where demand is strong. In March of 2019, 50 per cent of new home sales were priced below $300,000, compared to 39 per cent in March of 2018. These are the price points that are attractive for renters seeking to become homeowners.’

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