The inventory of unsold new homes increased by 2.0% to 153,000 in March from 150,000 in February; however, the pickup in overall sales resulted in the months' supply of new home available for sale holding steady at 4.4. This represented a tight supply of unsold homes compared to the longer-run average of 6.1 months' supply.
New home sales averaged an annualized 424,000 units in the first quarter of 2013, which was the highest quarterly level since the third quarter of 2008 and a whopping 51.2% annualized increase over the fourth quarter of 2012. The improving demand for new homes, along with the earlier indications of a similar trend for existing homes, is occurring in the face of tight supply conditions. This is contributing to rising home prices with an attendant lift to new home construction. While activity continues to run below pre-recession levels, residential investment is experiencing robust gains and points to this expenditure area playing a key role in the continued expansion of the overall US economy during this year and next.
Sales of new single-family homes in the US rose 1.5% to an annualized 417,000 units in March to retrace a small portion of the 7.6% drop to an unrevised 411,000 level in February. The level of sales in March was just above market expectations for a 416,000 reading. The modest headline increase in sales in March masked the large swings, with sales jumping in the Northeast (20.6%) and South (19.4%), and falling sharply in the West (-20.9%) and Midwest (-12.1%).
The inventory of unsold new homes increased by 2.0% to 153,000 in March from 150,000 in February; however, the pickup in overall sales resulted in the months' supply of new home available for sale holding steady at 4.4. This represented a tight supply of unsold homes compared to the longer-run average of 6.1 months' supply.
New home sales averaged an annualized 424,000 units in the first quarter of 2013, which was the highest quarterly level since the third quarter of 2008 and a whopping 51.2% annualized increase over the fourth quarter of 2012. The improving demand for new homes, along with the earlier indications of a similar trend for existing homes, is occurring in the face of tight supply conditions. This is contributing to rising home prices with an attendant lift to new home construction. While activity continues to run below pre-recession levels, residential investment is experiencing robust gains and points to this expenditure area playing a key role in the continued expansion of the overall US economy during this year and next.
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