New-Home Sales Rose 4.3% in November
December 23 2015 - 11:10AM
Dow Jones News
WASHINGTON—Sales of newly built U.S. homes rose last month in a
potentially encouraging sign for the housing sector.
Purchases of new single-family homes increased by 4.3% to a
seasonally adjusted annual rate of 490,000 in November, the
Commerce Department said Wednesday. October's sales pace was
revised down to 470,000 from an earlier estimate of 495,000.
Economists surveyed by The Wall Street Journal had expected a
November sales pace of 504,000.
New-home sales in November were up 9.1% from a year earlier.
Sales rose 14.5% in the first 11 months of 2015 compared with the
same period in 2014.
Sales of newly built homes account for only about 10% of the
U.S. housing market, and data on new-home sales are volatile and
subject to frequent revisions. In Wednesday's report, the margin of
error on November's 4.3% monthly sales gain was 11.9 percentage
points. There was a margin of error of 20.9 percentage points for
the annual gain of 9.1%.
Sales of previously owned homes plunged in November, falling
10.5% from the prior month to a seasonally adjusted annual rate of
4.76 million, the slowest sales pace for existing homes since April
2014, the National Association of Realtors said Tuesday.
Lawrence Yun, the Realtors group's chief economist, attributed
much of last month's sales decline to new government regulations
that he said have delayed closings. The Consumer Financial
Protection Bureau in October introduced new mortgage forms and a
requirement that lenders must give borrowers the final terms of a
loan at least three business days before closing.
News Corp, owner of The Wall Street Journal, also owns Move
Inc., which operates a website and mobile products for the National
Association of Realtors.
It has been a solid year for residential construction, though
home building remains far below prerecession levels. Housing starts
rose 11% in the first 11 months of 2015 compared with the same
period in 2014, the Commerce Department said last week.
"Housing has been recovering very slowly," Federal Reserve
Chairwoman Janet Yellen said last week. "But the demographics would
point to considerable upside for residential investment. My
mainline forecast is for gradual recovery, but there is upside risk
there."
The Fed last week raised its benchmark short-term interest rate
for the first time in nearly a decade, but signaled it plans to
increase rates only gradually in the coming months and years, which
could help blunt the impact on the housing sector. The average
interest rate on a 30-year fixed-rate mortgage was 3.97%, Freddie
Mac said last week, near historical lows.
According to Wednesday's report, there were 5.7 months of newly
constructed homes available for sale in November at the current
sales pace, down slightly from October's 5.8-month supply.
The median price for new homes sold in November was $305,000, up
0.8% from a year earlier.
Write to Ben Leubsdorf at ben.leubsdorf@wsj.com and Josh
Mitchell at joshua.mitchell@wsj.com
(END) Dow Jones Newswires
December 23, 2015 10:55 ET (15:55 GMT)
Copyright (c) 2015 Dow Jones & Company, Inc.
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