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New Home Sales  
Released On 12/27/2012 10:00:00 AM For Nov, 2012
PriorConsensusConsensus RangeActual
New Home Sales - Level - SAAR368 K375 K360 K to 390 K377 K

Highlights
The new home market showed strength in November with sales up 4.4 percent to an annual rate of 377,000. October was revised 7,000 lower to 361,000, weakness largely offset by a 5,000 upward revision to September. New home sales, which started the year near 340,000, have slowly been building up momentum this year.

Regional data are mixed with the month's positives being a rebound in the Northeast, which was hit by Hurricane Sandy in late October, and a big gain for the South. Both the West and Midwest show monthly declines.

Scarcity of supply is a big factor in the home sales market, at 4.7 months at the current sales rate for new homes vs 4.9 months in October. Price readings show gains in the month and strong year-on-year rates, at plus 14.9 percent for the median price and 19.9 percent for the average price.

The new home market is a positive for the economic outlook, especially given that scarcity of supply points to new construction ahead. But fundamental economic issues right now are being clouded by the approach of the fiscal cliff and the risk that higher taxes will hurt consumers and home buyers.

Consensus Outlook
New home sales for October edged down 0.3 percent to a 368,000 annual rate. This followed a 0.8 percent advance in September. The Commerce Department noted that Hurricane Sandy had only a minimal effect on October, hitting at month end and in only one area of the country. Sales in the Northeast, which is by far the least active region in the report, fell 32 percent in the month. Another unfavorable sign in the report was a second straight month of price weakness, down 4.2 percent for the median to $237,700. But these numbers are not based on repeat transactions and are affected by shifts in sales between price ranges. It is difficult to believe that new home prices for comparable houses can be down so sharply while other price measures are headed up. Supply remains low in the new home market at 4.8 months at the current sales rate.

Definition
New home sales measure the number of newly constructed homes with a committed sale during the month. The level of new home sales indicates housing market trends and, in turn, economic momentum and consumer purchases of furniture and appliances.  Why Investors Care
 
[Chart]
There is no question that lower interest rates boost home sales. Other factors also impact housing decisions, such as employment and income growth, and wealth stemming from stock market gains.
Data Source: Haver Analytics
 
 

2012 Release Schedule
Released On: 1/262/243/234/245/236/257/258/239/2610/2411/2812/27
Release For: DecJanFebMarAprMayJunJulAugSepOctNov
 


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