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Economy in Brief

U.S. New Home Sales Retrace All of This Year's Gains
by Tom Moeller  August 23, 2013

Fewer new home sales accompanied lower home prices last month. New home sales in July dropped 13.4% to 394,000 from 455,000 in June, initially reported as 497,000. The latest was the lowest number of new home sales since October. The figure disappointed the Consensus forecast for 492,000 sales in July. These volume figures are quoted at seasonally adjusted annual rates.

Sales were down across the country. The West paced the fall-off with a 16.1% drop (-7.8% y/y) to 94,000, the lowest figure since March of last year. The decline was followed by the South where home sales fell 13.4% (+16.4% y/y) to 213,000, the lowest level since October. The Midwest region followed with a 12.9% decline to 54,000 and were unchanged y/y. Finally, sales in the Northeast dropped 5.7% (+10.0% y/y) to 33,000.

The median price of a new home slipped 0.5% to $257,200. Prices have fallen 7.9% during the last three months. Nevertheless, they remain 8.3% ahead of July 2012. Average new home prices rose to $322,700 during July, up 6.8% from June and up 14.3% from a year ago.

The inventory of unsold homes rose by nearly one-quarter y/y and the months' sales supply of new homes rose to 5.2, its highest since January of last year. The length of time to sell a new home retreated in July to 3.5 months compared to 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. 

The Parts Are More Than the Whole: Separating Goods and Services to Predict Core Inflation from the Federal Reserve Bank of New York can be found here.

U.S. New Home Sales July June May Y/Y 2012 2011 2010
Total SAAR, 000s 394 455 439 6.8 368 306 321
Northeast 33 35 29 10.0 29 21 31
Midwest 54 62 75 0.0 47 45 45
South 213 246 233 16.4 196 168 173
West 94 112 102 -7.8 97 72 74
Median Price (NSA, $) 257,200 258,500 262,600 8.3 242,108 224,317 221,242
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