Sales of newly built single-family homes posted a substantial month in February. New-home sales rose to a seasonally adjusted annual rate of 592,000 units, up 6.1% month over month and 12.8% in front of a year ago, the Commerce Department reported this week.
New-Home Sales Increase 6%
“February’s increase in new home sales is consistent with builders’ growing confidence in the housing market,” says Granger MacDonald, chairman of the National Association of Home Builders. “Builders are encouraged by heightened consumer activity and by the expectation that regulatory costs will decline in the year ahead.”
The inventory of new homes for sale in February was 266,000, a 5.4-month supply at the current sales pace. The median sales price was $296,200.
New-home sales posted the best uptick in the Midwest in February, rising 30.9 percent month over month, followed by a 7.5% gain in the West and a 3.6 % improvement in the South. The Northeast was the one major region of the U.S. to see a decrease last month, with new-home sales falling 21.4 percent there.
“The uptick in mortgage interest rates is having a minimal effect on new-home sales thus far,” says Robert Dietz, NAHB’s chief economist. “Ongoing job creation, rising household formations, and affordable home prices should keep the market on an upward trajectory in 2017.”