New home construction WAY UP

Any one with half an eye open knows these monthly housing reports bounce like a yo-yo.  This month up, last month down, so the long term average is where to focus. New home sales are up 21% over the past 12 months ending October 2013.  That is a good sign!

After a drop in Sept. 2013, sales of new single-family homes in October 2013 saw their biggest month-over-month increase since May of 1980, according to data released today by HUD and the Census Bureau.

New single-family home sales were at a seasonally adjusted annual rate of 444,000 in October, according to a report by the Census Bureau and HUD. That’s 25.4% above the revised September rate of 354,000 and 21.6% above October 2012’s rate of 365,000.

The October rate is also considerably higher than the 425,000 projected by economists. However, new home construction is still less than half what it was at its pre market crash – which arguably was artificially high, and not a valid comparison to today’s market

Prices on new homes also fell slightly, but this is attributed to smaller average home sizes compared to just a few years ago.

The seasonally adjusted estimate of new houses for sale in October was 183,000, according to the Census Bureau. At the current sales rate, that equates to a supply of 4.9 months. The median sales price of new houses in October was $245,800. The average sales price was $321,000.

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