New Home Sales 'Solid' in 2016
Ten-Year High, NAHB Says
Sales of new single-family homes in 2016 increased to the highest annual rate since 2007, rising 12.2 percent to 563,000 units, the National Association of Home Builders said, citing data from the Census Bureau.
"We are encouraged by the growth in the housing sector last year, and by the fact that builders increased inventory by 10 percent in anticipation of future business," said Robert Dietz, chief economist of the NAHB. "NAHB's forecast calls for continued upward momentum this year, with housing starts expected to rise 10 percent over the course of 2017."
However, December sales of new single-family homes were 10.4 percent lower than November, and 0.4 percent less than December 2015, according to the Census Bureau.
"Despite the decline, new home sales rose solidly in 2016," said Mark Vitner, senior economist for the Wells Fargo Economics Group.
The median sales price of new houses sold in December 2016 was $322,500, while the average sales price was $384,000.
"We also note that December is a lighter month for sales, and therefore the magnitude of the monthly swings tends to be exaggerated," Vitner said. "New home sales ended 2016 on a weak note, as a spike in mortgage rates and the return of winter weather likely deterred some potential homebuyers."
Regionally, new home sales increased 48.4 percent in the Northeast, but fell 41 percent in the Midwest, 1.3 percent in the West, and 12.6 percent in the South.
Wells Fargo expects home sales to rise slowly in the first half of 2017, Vitner said.
The Census Bureau said new residential sales data for January will come out Friday, Feb. 24.