US new-home sales rebound in October

Sales of new single-family homes in the United States rebounded in October from a September slump, as prices fell year-over-year, according to official data released Wednesday. 

PHOTO: REUTERS

NOV 26, 20157:24 AM

[WASHINGTON] Sales of new single-family homes in the United States rebounded in October from a September slump, as prices fell year-over-year, according to official data released Wednesday.

New-home sales jumped 10.7 per cent to an annual rate of 495,000 in October and are 4.9 per cent higher than a year ago, the Commerce Department said.

The September sales slump was worse than previously estimated; the department downwardly revised the number by 11,000 to 447,000.

The often-volatile report on new-home sales showed a sharp tightening in supply of new homes on the market in October. At the current sales pace, there were 5.5 months of supply, down more than eight percent from September.

The median price of a new home fell to US$281,500, the lowest price since June.

Analysts emphasised the volatility in the data.

"New home sales surged in October - not really. There was a sharp rise in signed contracts but that was only because the September number was revised down," said Joel Naroff of Naroff Economic Advisors, calling the report "weird".

"Demand in the Northeast jumped by 135 per cent but fell slightly in the West. But the strangest number was median prices: They fell, yes fell, by 6.0 per cent from the October 2014 level. That makes no sense at all." Jim O'Sullivan, chief US economist at High Frequency Economics, said that the broader picture continued to show improvement in the new-home market.

"Smoothing out the data, new-home sales have averaged a 500,000 annual rate so far in 2015, up from 440,000 in all of 2014," he noted.

AFP