Sales of newly built houses have increased by 20.5% much wider than expected in August compared to July at the highest level since January 2022, according to the American census. It is also the largest gain of one month since August 2022. Sales were 15.4% higher than August 2024.
This count is based on purchases of people in August and signature transactions, when the average rate of the 30 -year fixed mortgage was higher than today. This rate started in August at 6.63%, according to MortGage News Daily, and did not really move much during the month.
The sharp drop in rates started in September, when it fell to a lower 6.13% by 6.13% the day before the federal reserve reduces its loan rate, then moved above where it is now at 6.37%.
Since the prices had not yet dropped, it is curious that the August sales jumped so high. Part of the answer may appear in the investigation itself.
“We expected a gain but not so tall,” said Robert Dietz, chief economist of the National Association of Home Builders. “Always important to remember the margin of error for sales of new houses is important. We will have to wait for the revisions next month and the September data point to see if it is smoothed.”
Homebuilder’s analyst Ivy Zelman by Zelman & Associates, said that the number was “directional, but the magnitude was far too high”. She also noted that the census report has a very small sample size and that large public manufacturers, who have a 60%market share, do not participate.
Zelman conducts his own survey, which has a higher sample size covering 15% of house manufacturers, and he showed an increase in sales of 6% from one year to the next, she said.
While the manufacturers have talked a lot to reduce prices and incentives, the median price of a new house sold in August was $ 413,500, up 1.9% from one year to the next. In a separate survey on the feeling of the manufacturers of the National Association of Home Builders, 39% of manufacturers said they had reduced prices in September, compared to 37% in August and the highest percentage of the post-fedest period.
Sales of new houses were the strongest in the northeast, where the new overall construction is low, so the swings can be significant. It was also strong in the south, where the construction of houses is the busiest. Sales, although higher, were the lowest in the West, where prices are the highest.
“Although a volatile figure every month and always better to smooth, I must believe that the high level of incentives of the manufacturer of houses was the main catalyst of the big surprise to increase sales of new houses,” wrote Peter Boockvar, director of investments for a BFG wealth partner. “And we will of course see the impact of lower mortgage rates when the September figure comes out, but keep in mind, if the mortgage rates continue … The manufacturers will then reduce the pace to which they implement incentives and therefore possibly compensate for the advantages of lower mortgage rates for new houses.”
Solid sales lowered an inventory to an offer of 7.4 months in August from an offer of 9 months in July, a drop of almost 18%. The unifamilial accommodation begins and licenses slowed down in August from July and from August from last year. This would seem to indicate that the manufacturers expected slower sales.