Dive Brief:
- New single-family home sales dropped 7.6% between July and August to a seasonally adjusted annual rate of 609,000, the Commerce Department reported Monday. August's rate was 20.6% higher than the rate of new home sales in August 2015.
- The median sales price of new homes sold last month was $284,000, down from $294,600 in July.
- August new home sales plummeted 34.3% in the Northeast after a surge in July, and they slipped 12.3% in the South and 2.4% in the Midwest. Sales increased 8.0% in the West.
Dive Insight:
A pullback in August was expected after July sales had their strongest showing since October 2007. In fact, new home sales — which represent approximately 10% of all home sales — didn't fall as far as economists expected, as they predicted an 8.0% drop, according to The Wall Street Journal.
Despite the dip in new home sales, sales for the first eight months of 2016 are 13.3% above the same period last year. That upward trend echoes predictions of a slow and steady recovery, rather than a sudden boom in activity. The fact that the median sales price of new homes dipped again last month indicates that builders are likely moving down in price point and offering more entry-level and affordable homes — answering the calls of first-time buyers and real estate agents.
Housing market reports this month have been mixed. Builder confidence jumped six points to its highest level in nearly a year, but housing starts fell 5.8% and existing-home sales slipped 0.9%. The pending home sales report, released Thursday, will round out the month's housing data.
To see all the latest construction data in one place, check out our Industry Pulse page here.
