The sales rate for new single-family homes rose in October for the first time since April, but fell about 23.5 percent compared to October 2006, the U.S. Census Bureau and the Department of Housing and Urban Development reported today.
Also, the median sales price of new homes dropped 13 percent in October compared to October 2006.
New-home sales reached a seasonally adjusted annual rate of 728,000 in October — this sales rate is a projection of a monthly sales total over a 12-month period, adjusted for seasonal fluctuations in sales activity.
An estimated 516,000 new homes were for sale at the end of October, down 6.7 percent compared to October 2006. That amounts to an 8.5 months’ supply of for-sale homes at the October sales pace. That compares to a supply of 7.1 months in October 2006.
A supply greater than six months is generally considered to indicate a buyer’s market.
The median sales price of new homes dropped from $250,400 in October 2006 to $217,800 in October 2007. And the average new-home sales price dropped 0.3 percent, from $306,800 to $305,800.
On Wednesday, the National Association of Realtors reported that the median price of U.S. resale homes fell 5.1 percent in October compared to October 2006.
Also, a Standard & Poor’s/Case-Shiller home-price index released this week revealed that new- and resale-home prices dropped 4.5 percent in the third quarter compared to third-quarter 2006.
Another index, released this week by the National Association of Home Builders and Wells Fargo, revealed that the national median price of new and resale homes sold in the third quarter dropped 3.6 percent compared to third-quarter 2006.
Statistics in the new-home sales report are estimated from sample surveys and are subject to sampling variability and non-sampling error including bias and variance from response, nonreporting, and undercoverage, the agencies reported.
Changes in seasonally adjusted statistics can show irregular movement, and it can take five months to establish a trend for new houses sold. The preliminary seasonally adjusted estimate of total sales is revised about 4 percent, on average, according to the report.