U.S. New-Home Sales Surge Past Estimates, Reach Nine-Month High




  • In Business
  • 2022-01-26 15:19:45Z
  • By Bloomberg

(Bloomberg) -- Sales of new U.S. homes rose in December to a nine-month high, indicating firmer demand at the end of 2021 despite high prices and still-limited inventory.

Most Read from Bloomberg

  • Stock Rebound Fails and Futures Plunge on Earnings: Markets Wrap

  • Mark Zuckerberg's Stablecoin Ambitions Unravel With Diem Sale Talks

  • Nvidia Quietly Prepares to Abandon $40 Billion Arm Bid

  • A Nor'easter Approaching New York Risks Becoming a Bomb Cyclone

  • Stocks Storm Back From 4% Rout to Close Higher: Markets Wrap

Purchases rose 11.9% from a month earlier to an 811,000 annualized pace, government data showed Wednesday. The median estimate in a Bloomberg survey of economists called for a 760,000 rate, and the December level exceeded all but one forecast.

An increase in the number of completed homes over the last two months and prospects of higher interest rates this year as the Federal Reserve tightens monetary policy may have encouraged a pickup in contract signings.

While potential buyers are still seeking more space as well as investment properties, prices remain high and builders continue to face some materials bottlenecks and labor constraints.

Even so, a separate report from the Conference Board on Tuesday showed home-buying plans over the next six months rose to a record high.

The new-home sales report, produced by the Census Bureau and the Department of Housing and Urban Development, showed the median sales price of a new home climbed 3.4% from a year earlier to $377,700.

For the full year, sales decreased to 762,000 from 822,000 in 2020, the report showed.

At the end of December, there were 403,000 new homes for sale, up slightly from a month earlier. At the current sales pace, it would take 6 months to exhaust the supply of new homes, compared with 3.8 months a year ago.

Construction Stage

Of the homes sold last month, construction on 231,000 had yet to be started, the most since May. Already completed homes rose to a three-month high of 187,000. The number of properties sold and currently under construction climbed in December to an 11-month high.

Sales rose in all regions but the Northeast. Purchases in the West were the strongest since January of last year, while sales in the South climbed to an eight-month high.

Separate data last week showed that existing home sales, which make up 90% of home purchases, dropped in December for the first time in four months, driven by limited inventory.

New-home purchases account for about 10% of the market and are calculated when contracts are signed. The new-homes data are volatile; the report showed 90% confidence that the change in sales ranged from an 8.4% decline to a 32.2% increase.

(Adds graphic)

Most Read from Bloomberg Businessweek

  • Market Turmoil Is Ultimate Test of What's Real and What's Not

  • The Tragicomedy of Boris Johnson Enters Its Final Act

  • The Charismatic Developer and the Ponzi Scheme That Suckered San Diego

  • What Happens When Russian Hackers Come for the Electrical Grid

  • Venture Investors' $1.4 Billion Bet on News Faces a Reality Check

©2022 Bloomberg L.P.

COMMENTS

More Related News

Russia
Russia's Whipsaw Week Ends With Default Clock Ticking

(Bloomberg) -- Russia is back in default countdown, with another bond payment in question and the Kremlin fighting to find an escape route.Most Read from...

Reasons to Worry Keep Piling Up for Davos Executives
Reasons to Worry Keep Piling Up for Davos Executives

(Bloomberg) -- War in Ukraine, rampant inflation and now a brewing global food crisis. If attendees at this year's World Economic Forum came to Davos worried...

Russian Wins in Eastern Ukraine Spark Debate Over Course of War
Russian Wins in Eastern Ukraine Spark Debate Over Course of War

(Bloomberg) -- Russian troops are making steady progress in Ukraine's east on the back of more-concentrated artillery and air power, now controlling almost...

Europe
Europe's Push to Punish Putin Is Falling Short of the Rhetoric

(Bloomberg) -- As the European Union's impasse over its supposedly imminent Russian oil embargo stretched into days and then weeks, one ambassador quoted...

US, Asian Allies Say Path to Talks With North Korea Still Open
US, Asian Allies Say Path to Talks With North Korea Still Open
  • World
  • 2022-05-28 02:45:17Z

(Bloomberg) -- A path to "serious and sustained dialogue" with North Korea remains open, according to a joint statement by US Secretary of State Antony...

Leave a Comment

Your email address will not be published. Required fields are marked with *

Cancel reply

Comments

Top News: Business