The U.S. Census Bureau and the Department of HUD announced today that the new single family home sales for September 2008 were at a seasonally adjusted annual rate of 464,000. This was 2.7% higher than August 2008 and 33.1% less than September 2007. Economists were expecting that sales would fall to 450,000. The median sales price fell to $218,400 in September down 0.9% from August 2008 and down 9.1% from September 2007. This is the steepest rate of decline since median prices peaked in March 2007.
Months Supply fell to 10.4 in September, from 11.4 in August. Months Supply is the amount of time it would take to completely sell the new homes inventory if no new homes were built and if the sales pace continued as is. Supply and Demand is balanced at 6 months. The current level will continue to put pressure on home prices both for new homes and existing homes.
The financial crisis really picked up steam in October. New home sales typically rise in October from September. It will be interesting to see what happens to new home sales for October.
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