ARLINGTON, Va. – The news on the home front – literally – is not improving much for most of the country.
Analysis by NAFCU of July home sales data shows sales were down by 35% over the same period one year earlier, although new home sales did increase by an annualized 2.4% from a downward-revised 503,000 units in June. The Midwest and South both reported drops in sales during July of 8.2% and 2.5%, respectively, while the Northeast and West saw respective increases of 38.9% and 9.9%, respectively.
Year-over-year, new home sales were down in three of the four regions, with the biggest decline of 42.7% in the West, said NAFCU.
NAFCU noted that July’s new home sales rose unexpectedly as a result of a sharp downward revision of June’s numbers to the lowest level since September 1991, and that the actual number of new home sales during July was lower than expected. “Inventories continue to slowly improve as builders are giving heavy price discounts on already built homes and are breaking ground on fewer new houses as well as are applying for less building permits,” the trade group stated, adding that inventories will have to be reduced further until the natural rate of five to six months of supply is reached.
“A weak economy and tight credit availability will continue to constrain demand, making a turnaround in the housing market unlikely before next year,” NAFCU said.
