New home sales up
According to the U.S. Census Bureau, new home sales rose 1.3 percent in October from September and are up 8.9 percent from October 2010, and although the rate fell short of economists’ forecasts, improvement in the hardest hit sector is welcomed by new home builders in any form. The month ended with a 6.3 month supply at the current rate of sale and a median sale price of $212,300.
Just last week, the National Association of Realtors reported that existing home sales for October were up, while the number of homes on the market as well as prices are declining. With Freddie Mac reporting mortgage interest rates have dropped below four percent again, all of these indicators may improve in November despite weather conditions that often slow the market in select regions.
Additionally, this month, the U.S. Commerce Department reported that single family housing starts rose 3.9 percent in October, but the improvement was masked by an 8.3 percent drop in multifamily starts that kept national housing production essentially flat in October up only 0.3 percent. Single family home permits issued rose to its fastest pace since December 2010, up 5.1 percent for the month, a forward-looking economic indicator that we use to consider what starts will look like in the future. The multifamily sector saw a 24.4 percent increase in permits issued, hinting at a continuing multifamily rollercoaster of volatility.
Housing starts for single family combined with multifamily was up 17.2 percent in the Northeast, 9.7 percent in the Midwest and 1.6 percent while starts dropped 16.5 percent in the West. Permits dropped in the Northeast 1.6 percent and 3.7 percent in the Midwest but rose 5.4 percent in the West and 21.5 percent in the South.
