Mortgage Blog

New Home Sales Increased in August

October 17th, 2019 12:30 PM by Eric Fang

With much surprise and delight, new home sales jumped in August 2019. According to the Commerce Department, there was a 7.1% increase with a seasonally adjusted annual rate of 713,000 units last month. This is great news for businesses involved in the housing industry, from construction workers to real estate agents. Most of the sales were single-family homes in the South and Western states.

Perhaps due to mortgage rates dropping, building permits and housing starts were at a whopping 12-year high in August. In addition, home resales rose to one of the highest levels seen in over 17 months. All of this information is great news for the economy overall.

Many believe that this improvement in housing data means that the housing market is finally rebounding after the recession of 2007-2009 that hit so many homeowners and housing industry jobs hard.

Interestingly, home sales in the Northeast section of the country fell by nearly 6% and the Midwest fell around 3%. The Southern portion of the country saw a 6% increase in the month of August, while the West rose 16.5%.

In evidence of homes selling rather quickly, August's sales pace should only take a little over five months for houses to sell, which is down from July's number of nearly six months. In August, we saw only 326,000 new homes on the market which is the lowest it has been since September of 2018. It certainly appears that new home sales are overtaking resales, as nearly 63% were still under construction or haven't even been built yet.

With the Millennial generation ready to purchase homes, it is no surprise that new home sales are on the rise. This generation is looking for specifics of what they want in a home and can have a home built that fits their lifestyle. Let's see what happens for new home sales in September and the rest of 2019! 
Posted in:General
Posted by Eric Fang on October 17th, 2019 12:30 PM



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