New-Home Sales Rebound
After hitting their lowest level in a year-and-a-half, new-home sales rebounded in October from September lows, this according to a report from the Commerce Department and Bloomberg (http://www.bloomberg.com 12.4.13, Economy)
According to the Commerce Department data, new-home sales in October surged by 25.4 percent over the previous month to a seasonally-adjusted annual pace of 444,000 units; this following a 354,000 rate in September that was the lowest level since April 2012. A Bloomberg survey of 62 economists had expected sales figures of 429,000.
Bloomberg stated that, “Home sales are regaining strength as gains in employment and stock prices help consumers adjust to this year’s increase in borrowing costs and property values, which have hurt affordability.”
According to Bloomberg new-home sales data is tabulated when contracts are signed and therefore are “considered a timelier [market] barometer than purchases of previously owned dwellings, which are calculated when a contract closes.”
Additional Commerce Department data points to a “sign of growing momentum,” as applications for building permits reached a five-year high in October. Requests for building permits rose 6.2 percent to a 1.03 million annualized rate, this after a September pace of 974,000 permits. The October figures were the highest since June 2008.
The surge in overall building permits was paced by a jump in applications for apartments and condominiums, which increased 15.3 percent after seeing a 20.1 percent gain in September.
The seasonally adjusted annual pace of existing home sales fell in October to 5.12 million units; this is the lowest level in four months. Bloomberg said buyers were “constrained by a limited supply and higher mortgage rates.” There were 2.13 million previously owned homes for sale at the end of October, down from 2.17 million the month prior.