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Economy in Brief

U.S. New Home Sales Fell for Second Consecutive Month
by Sandy Batten  March 23, 2022

• Downward revision to January more than offset by upward revision to December.

• Markets had expected an increase.

• Sales rose in Northeast and Midwest but fell in South and West.

New single-family home sales fell 2.0% m/m (-6.2% y/y) to 772,000 units at an annual rate in February from a downwardly revised 788,000 in January (initially 801,000). The downward January revision was more than offset by a 21,000 upward revision to December. The most recent peak in sales was 993,000 in January 2021. The Action Economics Forecast Survey expected sales of 813,000 sales in February. Supply continues to revive as the number of new homes for sale rose to 407,000 in February, the highest reading and the first above 400,000 since August 2008.

By region, sales in February fell in two major regions and rose in the other two. Sales jumped 59.3% m/m in the Northeast in February to 43,000 at an annual rate following a 20.1% m/m drop in January. Sales rose 6.3% m/m to 84,000 in the Midwest after an 8.1% m/m decline in January. By contrast, sales in the South edged down 1.7% to 451,000 in February on top of a 5.4% m/m drop in January while sales in the West decreased 13.0% m/m to 194,000 after a 12.6% monthly decline in January.

The median price of a new home declined 6.3% m/m (+10.7% y/y) in February to $400,600 following a 7.1% m/m increase in January. The average sales price of a new home rose 3.4% m/m (+25.4% y/y) in February to a record high $511,000. These sales price data are not seasonally adjusted.

The seasonally adjusted supply of new homes for sale rose to 6.3 months in February from 6.1 in January. The record low was 3.5 months reached in August, September and October of 2020. The median number of months a new home stayed on the market fell to 2.5 months in February, tying the record low reached in October, from 2.9 months in January. These figures date back to January 1975.

New home sales activity and prices are available in Haver's USECON database. The consensus expectation figure from Action Economics is available in the AS1REPNA database.

U.S. New Single-Family Home Sales (SAAR, 000s) Feb Jan Dec Y/Y % 2021 2020 2019
Total 772 788 860 -6.2 770 822 683
  Northeast 43 27 34 7.5 36 37 30
  Midwest 84 79 86 -19.2 86 93 72
  South 451 459 485 -3.0 452 474 399
  West 194 223 255 -9.3 196 218 182
Median Price (NSA, $) 400,600 427,400 399,100 10.7 398,800 336,900 321,500
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