Sales of newly built, single-family homes increased 7.1% to a seasonally adjusted annual rate of 713,000 units in August of a revised upward reading in July, according to newly released data by the U.S. Department of Housing and Urban Development and the U.S. Census Bureau. On a year-to-date basis, new home sales for 2019 are 6.4% higher than the same period in 2018.

“With job growth continuing and lower interest rates in place, builders report rising confidence levels, and this is reflected in today’s solid sales report,” said Greg Ugalde, chairman of the National Association of Home Builders (NAHB) and a home builder and developer from Torrington, Conn.

The August reading of 713,000 units is the number of homes that would sell if this pace continued for the next 12 months while adjusting for seasonal effects. A new home sale occurs when a sales contract is signed or a deposit is accepted. The home can be in any stage of construction: not yet started, under construction or completed.

“We have seen a general rebound in the housing market since spring, as sales, starts and permits have all registered gains,” said Danushka Nanayakkara-Skillington, NAHB’s AVP for forecasting and analysis. “However, affordability remains a factor because buyers can’t benefit from lower interest rates if they don’t have the money for a down-payment.”

The inventory of new homes for sale was 326,000 in August, representing a 5.5 months’ supply. The median sales price was $328,400. The median price of a new home sale a year earlier was $321,400

Regionally, and on a year-to-date basis, new home sales are 11.7% higher in the South and 7.8% higher in the West. Sales are down 16.5% in the Northeast and 10.5% in the Midwest.

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