New home sales were down slightly in August compared to July, slipping 0.3 percent to a seasonally adjusted annual rate of 373,000 units and were 27.7 percent above the estimate of 292,000 in August 2011. July sales were revised up from the originally reported annual rate of 372,000 to 374,000. On a non-seasonally adjusted basis there were 31,000 homes sold during the month compared to 34,000 in July and 25,000 one year earlier.
The median price of a new home sold in August was $256,900 compared to $231,100 in July and $219,600 in August 2011. The average sales price last month was $295,300 compared to $270,600 and $259,300 in the two earlier periods.
The inventory of unsold new homes at the end of August totaled 141,000, unchanged from July. This represents a 4.5 month supply at the current pace of sales. One year ago the inventory stood at 161,000, a 6.6 month supply.
On a regional basis, the annual rate of sales in the Northeast was 36,000 units, an increase of 20 percent from July and 56.5 percent from one year earlier. In the Midwest sales were up 1.8 percent to 56,000 units, a 16.7 percent improvement year-over-year. The rate of sales in the West increased 0.9 percent to 107,000 units annually, a 64.6 percent improvement from August 2011. The rate in the South however decreased 4.9 percent to 174,000 units but remained 11.5 percent above the rate in the same period in 2011.
Omer Esiner, Chief Market Analyst, Commonwealth Foreign Exchange, Washington said of the data, "We care about the housing numbers a little bit more these days given the increasing signs that the sector is at or near a bottom. It's a key element in the overall economic recovery and one that could signal that conditions on the whole are improving. This number will have very little impact on markets as the focus right now is squarely on developments in the euro zone."
T. Doug Dale, Chief Investment Officer for Security Ballew in Jackson, Mississippi said, "It's a continual amount of evidence that in spite of low interest rates we still have a dysfunctional market because you have a lot of people who still can't get refinancing or sell their house because it is underwater. It's still a meaningful enough amount of housing stock that might explain that here we are at 50-year low mortgage rates and are not seeing the housing market just take off."
