New Homes Sales Are On The Rise

New home sales are picking up steam. This may be another sign that the housing market is finally recovering. New home sales in April rose 3.3% from March and were up 9.9% from a year earlier, to a seasonally adjusted rate of 343,000 according to the Commerce Department.

However, we are still far below historic levels. Since 1963, the average new single-family homes sold per year in the U.S. has been 671,000. New homes account for about 10% of the houses sold each year. 

Sales of previously owned homes have also risen lately, suggesting gains throughout the housing industry. The National Association of Realtors said that sales of previously owned homes rose 3.4% in April from March. This includes sales of multi-family dwellings, such as condominiums and duplexes. The Commerce Department figures only include single-family homes.

Housing prices are also rising. The median new home price in April was $235,700, which is nearly 5% higher than a year earlier. With all of this news, some economists are becoming more encouraged about the housing market. However, some economists and analyists had expected even stronger new home sales based on the double-digit order increases in recent months by large publicly-traded home builders.

Toll Brothers, Inc., which is a luxury builder, said that its contracts for the quarter ending April 30th were up 47% from last year. The National Association of Home Builders also reported that confidence among home builders hit a five year high in May.

It is important to note that the housing recovery could quickly revert if the economy goes back down, interest rates rise or inventory swells as banks seek to sell more foreclosed properties. If you are facing foreclosure I may be able to help you save your home and stop the foreclosure process through bankruptcy or other means.

146,000 new homes were listed for sale at the end of April, a supply that would take over 5 months to deplete at the current sales pace. Only 46,000 new homes were completed in April, a record low. However, decreasing inventories could increase future new home building. Home prices also rose 1.8% in March, on a seasonally-adjusted basis, compared to the previous month. As always, questions or comments are welcome.