New residence sales increased for a fourth consecutive month in August.
Sales of new single-family homes rose 1.5% last month to a seasonally adjusted annual rate of 740,000, according to the US Census Bureau and the Department of Housing and Urban Development. The rate was 24.3% lower than the August 2020 reading of 977,000.
Analysts polled by Refinitiv expected 714,000 new homes sold, more than the revised upward rate of 729,000 in July.
New home sales, which account for around 10% of the housing market, had fallen through July for every month in 2021 as buyers faced low inventories and record prices.
“New home sales appear to be balancing out after the bottom of the recession and the ensuing craziness, which peaked about a year ago and is pushing inventories down,” said Robert Frick, business economist at Navy Federal Credit Union. “Inventories have returned to a normal range, but the new equilibrium is for homes that are much more expensive, which increasingly excludes first-time buyers from the new home market.”
The median price of new homes sold last month hit a record $ 390,900, from $ 390,500 in July. Prices were 20% above last year’s level of $ 325,500.
The increase in new home sales comes two days after the National Association of Realtors said existing home sales fell 2% in August to a seasonally adjusted annual rate of 5.88 million. August marked the fourth month in five that sales declined.