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New-home sales increased between October and November, but fell significantly from 2021 levels, according to U.S. Census Bureau and Department of Housing and Urban Development data released Friday.
New-home sales rose 5.8 percent to a seasonally adjusted rate of 640,000, up from 605,000 in October, 15.3 percent below the November 2021 level of 756,000, according to the data. The uptick reflects the second-straight month of increased sales following a dramatic 10.9-percent dip in September.
“A dip in mortgage rates and aggressive incentives from homebuilders sent the number of new-home sales up in November, Bright MLS Chief Economist Dr. Lisa Sturtevant said in a statement. “However, despite the modest uptick in contracts signed on new homes, the housing market remains in a lull, a pattern that likely will continue as we head into January.”
The median price of new homes sold in November clocked in at $471,200, a 9.5 percent increase from a year ago, while the average sale price now stands at $543,600.
“The median price of a new home rose again in November, defying expectations that builders would slash prices to work through inventory,” Sturtevant said. “Instead of cutting prices, builders seem to be working through existing inventory by offering concessions instead of price cuts. Home prices did fall from October, which is more of a seasonal trend.”
Other economists attributed the continued price growth to steep construction costs, which they said is keeping builders from pricing homes to sell.
“The impact of higher construction costs has made building entry-level homes particularly difficult, and this is where we see the greatest amount of pricing out for the housing market,” NAHB Chief Economist Robert Dietz said in a statement. “In November 2021, 13% of new home sales were priced below $300,000. That share has now fallen to 7%.”
At the end of November, the seasonally adjusted estimate of new homes for sale sat at 461,000, representing a supply of 8.6 months at the current sales rate, according to the Census Bureau.
The modest uptick in new-home sales comes on the heels of data released Wednesday from Redfin revealing that home sales across the board plunged 35.1 percent annually in November, the biggest decline since the company began tracking the metric in 2012.
