New Home Sales Are Way Above Expectations

New home sales fell 2.1% in November, worse than expectations for a 0.9% fall.

But the level came in at an annualized pace of 464,000.

This was better than expectations for a fall to an annualized pace of 440,000.

The median sales price of new houses was $US270,900 and the average sales price was $US340,300. There was 4.3 months’ supply of new homes at the current sales rate.

October new home sales were revised down to show a 17.6% rise to an annualized pace of 474,000.

This compares with the initial reading of a 25.4% rise to 444,000 in October.

There were two main factors behind the surge in October new home sales. First, they were coming off a weaker base and second, the impact of rising mortgage rates ended up being worse than expected but was temporary.

Homebuilder confidence climbed to 58 in December and November housing starts climbed to the highest level since February 2008.

But economists expect home prices to slow going forward.

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