The sales rate for new single-family homes dropped 17.4 percent in August and the median price dropped 1.3 percent compared to August 2005, the U.S. Census Bureau and the Department of Housing and Urban Development reported today.
New homes sales were at a seasonally adjusted annual rate of 1.05 million in August, which is 4.1 percent above the revised July rate. The rate is a projection of a monthly sales total over a 12-month period, adjusted for seasonal fluctuations in sales activity.
The median sales price of new houses sold in August 2006 was $237,000 and the average sales price was $304,400. The average sale price rose 3.2 percent compared to August 2005.
The seasonally adjusted estimate of new houses for sale at the end of August was 568,000, which represents a supply of 6.6 months at that month’s sales rate. That compares to a 4.6-month supply in August 2005. A supply greater than six months is generally considered to indicate a buyer’s market while a supply less than six months indicates a seller’s market.
Statistics are estimated from sample surveys and are subject to sampling variability as well as non-sampling error including bias and variance from response, non-reporting, and under-coverage, the agencies reported.
Changes in seasonally adjusted statistics can show irregular movement. It can take six months to establish a trend for new houses sold, according to the report. The statistics are primarily based on a sample of houses selected from building permits. Since a “sale” is defined as a deposit taken or sales agreement signed, this can occur prior to a permit being issued, according to the report. An estimate of these prior sales is included in the sales figure. On average, the preliminary seasonally adjusted estimate of total sales is revised about 3 percent.
Changes in sales price data reflect changes in the distribution of houses by region, size, etc., as well as changes in the prices of houses with identical characteristics.