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• New home sales climbed 0.4% in October to a seasonally adjusted annual rate of 745,000 units
• Sales were strong in the Midwest and densely populated South, but fell in the West and Northeast
U.S. new home sales rose slightly in October, while sales for the earlier month was revised down sharply.
New home sales climbed 0.4% in the last month to a seasonally adjusted annual rate of 745,000 units, the Commerce Department said on Wednesday.
Home sales for September was revised down to 742,000 units from 800,000 units, as reported earlier.
Sales were strong in the Midwest and densely populated South, but fell in the West and Northeast.
Sales fell 23.1% in October on a yearly basis and peaked in January to 993,000 units—highest since 2006.
Demand for homes boosted over the summer last year as people shifted towards home offices and online schooling during the pandemic. With reopening of offices and schools, the demand seems to fade away.
New homes are still in demand due to shortage of previously owned homes in the market.
Home prices
Price of new house surged 17.5% in October to $407,700 from a year ago with 389,000 new homes on the market in the month, compared to 378,000 units in September.
Builders are struggling due to labor and materials shortage. In October, houses under construction made up 62.2% of the inventory, while homes yet to be built accounted for about 28%.
Last week, the government reported that October had the largest backlog of houses yet to be constructed in 15 years.
Economists had forecast new home sales unchanged at 800,000 units in October, according to Reuters.
Picture Credits: Reuters