New Home Sales Plunged to a One-year Low In November

Brian Turner
22 Dec, 2023
New York City

Sales of new single-family houses in November declined to a seasonally adjusted annual rate of 590,000, the U.S. Census Bureau and the Department of Housing and Urban Development estimated in a report released on Friday.

New home sales declined 12.2% from the revised October rate of 672,000, but were 1.4% higher than the 582,000 estimate in the month a year ago.

The media price of new homes sold in November was $434,700, and the average price was $488,900.

The seasonally adjusted estimate of new houses for sale at the end of November was 451,000. This represents a supply of 9.2 months at the current sales rate.

Seasonally adjusted private home sales peaked in July at an annual pace of 728,000 and dropped below 600,000 for the first time in 2023.

The monthly supply of available homes for sale jumped above 9 months for the first time in 2023 after dropping to a low of 7.1 in July.

The percentage of all homes sold above $750,000 dropped below 7% from 10% in October and from 15% in the month a year ago.

Meanwhile, housing starts and completions continued to rise at a healthy pace in November, according to a separate report released by the government agency on Tuesday.

Seasonally adjusted single-family housing starts in November increased 18% from the previous month to a rate of 1.14 million.

Seasonally adjusted single-family housing completion declined 3.2% from the previous month to a rate of 960,000.

Newly built homes have become an increasingly attractive option for home buyers after existing home sales are hovering at a 30-year low and new home sales are estimated to jump at least 9% this year.

New home sales, which account for about 14% of all home sales, are generally priced higher than existing homes, and about 76% of all new home sales were priced between $300,000 and $749,00 in November.

New homes are generally priced higher than existing ones.

Despite the median home price declining 6% from a year ago to $434,700, the new homes are still priced higher than the $391,800 median home price of existing homes in November.

The popular 30-year fixed-rate mortgage rate has edged slightly lower after peaking at a 23-year high of 7.79% in late October to just below 7%, according to the data available from the government-owned mortgage lender Freddie Mac.