The rate of new single-family home sales fell about 4.3 percent from June to July and dropped about 21.6 percent from July 2005 to July 2006, the U.S. Census Bureau and the Department of Housing and Urban Development reported today.
The seasonally adjusted annual rate of new single-family home sales slipped to 1.07 million in July. This rate is a projection of a monthly total over a 12-month period, adjusted for seasonal fluctuations in sales activity. The July rate is about 4 percent lower than the average rate of single-family new-home sales for the first six months of the year.
The seasonally adjusted estimate of new houses for sale at the end of July was 568,000. This represents a supply of 6.5 months at the current sales rate. A supply of six months is considered to be a rough equilibrium between a buyer’s market and a seller’s market, with a supply greater than six months indicating a buyer’s market.
The median sales price of new houses sold in July 2006 was $230,000 and the average sales price was $293,500. In July 2005 the median price was $229,200 and the average price was $289,300.
Regionally, the rate of new single-family home sales dropped about 42.9 percent in the Northeast, 35.4 percent in the Midwest, 23.4 percent in the West and 12.4 percent in the South in July 2006 compared to July 2005.
Statistics are estimated from sample surveys and are subject to sampling variability as well as non-sampling error including bias and variance from response, non-reporting, and under-coverage.
Changes in seasonally adjusted statistics can show irregular movements, the agencies noted, and it can take six months to establish a trend for new houses sold. Preliminary new-home sales figures are subject to revision due to the survey methodology and definitions used.
The survey data is primarily based on a sample of houses selected from building permits. Since a “sale” is defined as a deposit taken or sales agreement signed, this can occur prior to a permit being issued, according to the report. On average, the preliminary seasonally adjusted estimate of total sales is revised about 3 percent.
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