New Home Sales Plunge

New home sales fell 7.1% month-over-month in December to an annualized pace of 414,000 units.

This was worse than expectations for a 1.9% fall to an annualized rate of 455,000.

The extreme cold weather is expected to have weighed on home sales and homebuilder stocks moved up on the release.

The median sales price was $US270,200, while the average sales price was $US311,400.

Meanwhile, the supply of new homes stood at 5 months at the current sales pace. This is up from 4.7 months in November.

Meanwhile, last month’s number’s were revised down to reflect a 3.9% fall to an annualized pace of 445,000 units in November.

This is down from the initial reading of a 2.1% fall to 464,000.

New home sales averaged 469,000 in October and November, about 21% above the 388,000 average in the third quarter, Credit Suisse analysts pointed out in a note ahead of the data release. “We estimate they are due for some giveback in December.” They expect new home sales could fall as much as 3% on the month to 450,000.

New home prices have been rising and they aren’t spending very long on the market.

Housing starts continue to fall and the extreme cold are expected to be weighing on housing data.

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