New home sales of single-family houses in February dropped 3.3% to 440,000, reaching a 5-month low, according to the latest report from the U.S. Census Bureau and the U.S. Department of Housing and Urban Development.
This is a dip from the revised January rate of 455,000 and is 1.1% below last year’s estimate of 445,000.
“This isn’t surprising. February is typically a slow time of year for new home sales across the board. Not many new home buyers sign contracts at the beginning of the year because buying a home isn’t a top priority after the holidays. We saw purchase declines in the MBA Mortgage Application Surveys during January and February and we’ll likely see some more slowdown before we get geared up for March and the spring season," said David Williams, vice president at RightStart Mortgage, based in Pasadena, Calif.
“The snow in the Midwest and Northeast also had at least some factor to slowing sales in the Midwest, Northeast and Mid-Atlantic states. It’s not so much that they were hit by snow, but it was on the weekends," Williams said. "Nobody is looking for a home when it’s snowing. We saw new single-family home sales up 3.2% for the month in January, which was still pretty good. I think we’ll see it bounce back in March.”
However, January’s revised rate changes the January to December rate from a 9.6% to roughly a 6% change.
In addition, the median sales price of a new house sold in February 2014 was $261,800, and the average sale price was $317,500.
The estimate of new homes for sale at the end of February reached 189,000, representing a 5.2-month supply.