New Home Sales Improve Year-Over-Year
September 29, 2011
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The latest report from the Commerce Department showed that while
sales of newly sold properties decreased on a monthly basis in
August, they increased year-over-year. That could signal improved
long-term growth for the housing market.
New single-family residential sales reached a seasonally
adjusted annual rate of 295,000 units in August, according to the
report. Though that was down 2.3 percent from the previous month,
the figure was a 6.1 percent improvement from the 278,000 pace
reported during August 2010.
The agency estimated that there were a seasonally adjusted
162,000 newly built homes available for sale in August. That
translates to a 6.6-month supply, meaning it would take roughly
that long to eliminate that supply at the current sales pace.
Housing experts note a six-month supply is typically what's found
in a "healthy market."
Industry figures responded to the report with some optimism, though
home builders note most homebuyers appear to be in the market for
existing homes, which are more affordable and plentiful than newly
Bob Nielson, chairman of the National Association of Home Builders,
said the new homes market is most favorable for first-time
homebuyers, who don't have to wait to sell a current home before buying a home.
Even so, existing homes remain attractive to both first-time and
repeat homebuyers for their affordability. Some consumers turn to
loans to help them finance project properties, which may
require extra work, such as painting, re-carpeting or repair.
If you're testing the market and looking for an existing property
seems more suitable than building a home, determine some common
needs and desires so that you can narrow down your options on the
market. You're not going to find everything you want in a single
property, but having a general idea of location and amenities can
prevent a drawn out home shopping experience.