Changes in economic scenario such as healthy hiring and smaller increases in price for new homes have ultimately begun pushing sales higher, which had been hammered during the Great Recession and saw a slow recovery even after the lowdown ended in 2009.
Advertisement
“The new-home market should continue to grow in the months and years ahead”, Smoke said. Why?
Surveys show that homebuilders’ outlook is the most optimistic in a decade, a sign that construction could pick up. In April 2008, new home sales hit an all-time low, with an annualized rate of just 536,000 units.
“We are envisioning further improvements in the housing market”, Yellen said at her press conference last week, responding to a question from MarketWatch. Recently, supply of new homes has been very limited, so more construction could encourage more sales. Existing-home purchases fell 4.8 percent last month to a 5.31 million annual rate from a 5.58 million pace that was the strongest since 2007, according to the National Association of Realtors.
The median sales price of new houses sold in August 2015 was $292,700; the average sales price was $353,400. “All the ingredients are there for further strengthening in the housing market”.
Right now, however, potential buyers are facing fewer choices than would normally be the case.
Advertisement
New home sales were 21.6% higher last month compared to August 2014, aided by low mortgage rates, the steady creation of more jobs and an improved economy. That’s below the six months that is more common historically.
