ARLINGTON, Va.—Following three consecutive months of "strong" rises, new home sales fell slightly in September – declining 3.5% to 959,000 units. Compared to a year ago, sales were up 32.1%."The single-family pipeline is starting to fill up, as both permits and units under construction are up over 20% from a year ago, and homebuilder sentiment hit an all-time high in October," noted NAFCU Chief Economist and Vice President of Research Curt Long. "But shortages are still acute and are being felt in both the new and existing homes markets.
"Record-low mortgage rates remain a strong tailwind along with seemingly insatiable demand,"continued Long. "NAFCU expects new home sales to remain strong through the rest of 2020."
Sales rose in only one of the four regions during the month, up 3.8% in the West. Sales fell 28.9% in the Northeast, followed by a 4.7% decline in the South and a 4.1% drop in the Midwest.
Based on current month sales, there were 3.6 months of supply in September, up slightly from 3.4 months in August. The number of unsold homes left on the market rose to 284,000 units, an 11.4% reduction from year-ago inventory levels.
Of note, the median new home price decreased from $325,600 (non-seasonally adjusted) in August to $324,000 in September. The month's prices were up 2.6% from a year ago, Long said.
Eisenberg Analysis
In his analysis of the latest housing numbers, Dr. Elliott Eisenberg, the economist who is a frequent presenter to credit unions, noted the September new home sales numbers are “amazingly up” 16.9% year to date, but year-over-year growth is declining, inventory is up slightly, and sales are 3.5% lower than last month and almost 1% down from the month before.
“All this suggests that peak 2020 new sales are behind us,” tweeted Eisenberg.
"Record-low mortgage rates remain a strong tailwind along with seemingly insatiable demand,"continued Long. "NAFCU expects new home sales to remain strong through the rest of 2020."
Sales rose in only one of the four regions during the month, up 3.8% in the West. Sales fell 28.9% in the Northeast, followed by a 4.7% decline in the South and a 4.1% drop in the Midwest.
Based on current month sales, there were 3.6 months of supply in September, up slightly from 3.4 months in August. The number of unsold homes left on the market rose to 284,000 units, an 11.4% reduction from year-ago inventory levels.
Of note, the median new home price decreased from $325,600 (non-seasonally adjusted) in August to $324,000 in September. The month's prices were up 2.6% from a year ago, Long said.
Eisenberg Analysis
In his analysis of the latest housing numbers, Dr. Elliott Eisenberg, the economist who is a frequent presenter to credit unions, noted the September new home sales numbers are “amazingly up” 16.9% year to date, but year-over-year growth is declining, inventory is up slightly, and sales are 3.5% lower than last month and almost 1% down from the month before.
“All this suggests that peak 2020 new sales are behind us,” tweeted Eisenberg.
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