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Economy in Brief

U.S. New Home Sales Unexpectedly Decline Sharply
by Tom Moeller  April 23, 2014

New home sales during March fell 14.5% to 384,000 (-13.3% y/y), the lowest level since July. February sales were revised to 449,000, initially reported as 440,000. The latest figure disappointed expectations for 450,000 sales in the Action Economics Forecast Survey. These volume numbers are quoted at seasonally adjusted annual rates.

Sales declines were logged in most regions of the country. Sales in the Midwest fell 21.5% to 51,000 (-17.7% y/y), the lowest level since December 2012. Sales in the West were off 16.7% to 80,000 (-27.9% y/y), the lowest level since January 2012, while sales in the South declined 14.4% to 226,000 (-3.8% y/y), the least in six months. Working the other way, new home sales in the Northeast improved 12.5% to 27,000 (-22.9% y/y) and recovered just a piece of February's plunge.

Median prices for new homes jumped 11.2% to $290,000 (12.6% y/y) from $260,900. The average price of a new home increased 4.8% to $334,200 (11.3% y/y) versus 318,900 in February.

The inventory of unsold homes increased 3.2% (25.3%) to the highest level since November 2010. The months' sales supply of new homes gained to 6.0, the highest level since October 2011. The length of time to sell a new home held steady m/m at 3.5 months, down from 14.0 months at the end of 2009.

The data in this report are available in Haver's USECON database. The consensus expectation figure is from the Action Economics survey and is available in the AS1REPNA database.

Credit Scoring and the Revolution in Debt from the Federal Reserve Bank of Richmond is available here.

U.S. New Home Sales Mar Feb Jan Y/Y % 2013 2012 2011
Total SAAR, 000s 384 449 470 -13.3 431 368 306
Northeast 27 24 36 -22.9 30 29 21
Midwest 51 65 51 -17.7 61 47 45
South 226 264 262 -3.8 234 196 168
West 80 96 121 -27.9 106 97 72
Median Price (NSA, $) 290,000 260,900 262,700 12.6 264,600 242,108 224,317
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