New Home Sales Fall in August, But Prices Jump
Sales of new home in the United States dipped 0.3 percent in August from July, but the median price of homes sold last month rose by a record amount, according to the Commerce Department.
New home sales amounted to a seasonally adjusted annual rate of 373,000 in August, down 0.3 percent from a revised total of 374,000 in July. That was 27.7 percent higher than July 2011, but was well below the pace of 700,000 that economists consider healthy.
The median price of a new home jumped 11.2 percent in August, the biggest one month gain on record. The median price of $256,900 was the highest since new homes sold for $262,600 in March 2007.
A dip in new single-family home sales was unexpected, but rising home prices are adding to signs that the housing market is on its way to recovery.
Record-low borrowing costs continue to attract buyers, lifting demand for homebuilders, while a drop in the supply of foreclosed homes — and short sales — is easing downward pressure on prices. Borrowing costs continue to boost housing demand. The average rate on a 30-year fixed mortgage dropped to 3.49 percent in the week ended Sept. 20, matching a reading two months ago as the lowest in records dating to 1972, according to McLean, Virginia-based Freddie Mac.
Regionally, purchases fell in only one of four regions as demand in the South dropped 4.9 percent. Sales jumped 20 percent in the Northeast, rose 1.8 percent in the Midwest and 0.9 percent in the West.
To read the full report, visit Commerce Department’s news release.
Author Bio: Rob Alley earned a bachelors degree at Virginia Tech, in Blacksburg, VA in Biology. Rob Alley consults with homeowners regarding Real Estate transactions and speciliazes in listing and selling Charlottesville Real Estate. Realtor/Owner of Virginia Real Estate Solutions at RE/MAX Assured Properties
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