Sales of new single-family houses in August 2014 were at a seasonally adjusted annual rate of 504,000, up from July’s printing of 427,000, the fastest rate in six years and the biggest monthly jump since January 1992.
This August reading is 18% above the revised July rate and is 33% above the August 2013 estimate of 379,000.
“While this report is prone to some volatility and revisions, it’s promising to see new home sales finally begin to catch up with homebuilder sentiment, which is at its highest level in almost a decade,” Quicken Loans vice president Bill Banfield. “Growth in new home sales is largely driven by a strengthening economy; this boost suggests more families are entering the market looking for new homes, instead of opting for more affordable existing units.”
The biggest gains and by far the reason for the big increase were new home sales in the West, one of the two largest housing markets, along with the South. New home sales in the West were up 50% over July. The South saw an 8% increase.
The median sales price of new houses sold in August 2014 was $275,600; the average sales price was $347,900.
The seasonally adjusted estimate of new houses for sale at the end of August was 203,000. This represents a supply of 4.8 months at the current sales rate.
New home sales for July posted at a lower-than-expected 427,000 annual sales rate. But the two prior months were revised higher by a total of 28,000. July's gain was centered entirely in the South which rose 8.1% in the month. The South is by far the largest region for new home sales, outdistancing all other regions combined.