The September 2015 New Residential Single Family Home Sales plunged by -11.5%. Sales dropped by 61,000 annualized units to 468,000 for the month. August was significantly revised downward from 552 thousand to 529 thousand sales. The plunge took annual growth from 21.6% as reported last month to only 2.0% growth from the 459,000 year ago sales levels. The annual increase is way within the ±17.9% margin of error. In this Census survey, amounts are annualized and represent what the yearly volume would be if just that month's rate were applied to the entire year. These figures are also seasonally adjusted. The monthly percentage change is outside the ±11.3% margin or error, a rarity, although sales figures are almost always revised. Many in the press are saying this plunge is temporary. We think the economy is slowing and more importantly, people are tapped out and simply cannot afford the soaring home prices.
The September 2015 average home sale price was $364,100. This is a 6.2% soaring monthly increase.. From a year ago the average price has soared up by 14.1%. With these kinds of price changes it is no surprise that new home sales plunged.
The median home price is $296,900 and had a 2.7% change from the previous month. From September 2014, the median new home sales price has increased a whopping 13.5%. Median means half of new homes were sold below this price and both the average and median sales price for single family homes are not seasonally adjusted.
Inventories: New homes available for sale is now 225,000 units, a 4.2% increase from last month. From a year ago inventories have increased 7.7% and this is outside the ±6.5% margin of error. The monthly change is also outside the ±1.9% error margin.
The graph below shows how long it would take to sell the new homes on the market at each month's sales rate. For September the time stands at 5.8 months. This is a 18.4% monthly change and a 5.5% annual one.
The median time a house was completed and on the market to the time it sold was 3.3 months. From a year ago that time period was 3.0 months. This implies the median time to move new properties is still somewhat stable.
The September median price is just shocking, correlating to way too high of a mortgage and down payment that most can afford. It is completely believable people are being squeezed out of the housing market and this isn't temporary.
A note on Census New Home Sales survey report: The variance in monthly housing sales statistics is so large, in part, due to the actual low volume overall, along with the fact this is a survey. One needs to look at least a quarter of time to get a real feel for new home sales, but a year of sales data is more in order. Additionally this report, due to it's huge margin of error, is almost always revised significantly the next month. Buyer beware on month to month comparisons and reacting to primarily figures and why we graph up the statistics so one can identify a real trend versus press headline buzz. The graphs show the trend much better than the monthly percentage changes.
The Census notes that the average revision is about 5% of the original reported. Here are our overviews of residential real estate statistics, only some graphs revised.