New home sales down 40% this year to lowest level since 2016
REAL ECONOMY BLOG | August 23, 2022
Authored by RSM US LLP
New home sales extended this year’s slump by dropping 12.6% in July to 511,000 annualized, following a 7.1% drop in June, the Commerce Department reported on Tuesday.
July’s data added to a total of near 40% decline in new home sales in the first seven months of the year. The decline brought the sales number to the lowest level since 2016 as steep mortgage rates and economic uncertainties around inflation pulled down demand.
With the Federal Reserve striking a more hawkish tone in recent weeks, sales of new homes will most likely have more room to fall this year.
At July’s sales pace, there was enough inventory for about 10.9 months of supply, the highest since 2009, near the end of the Great Recession.
Median prices rose by 5.9% on the month, mostly because prices often peak in July. Taking out that seasonal factor, the year-over-year price growth fell to 8.2% from 10.7% in June, short of the long-term average of 4.5% in the 2010-2019 period.
Beneath the top line, sales dropped in the Midwest to 54,000 from 68,000 previously; in the South to 324,000 from 389,000 previously; and in the West to 98,000 from 113,000 previously. Sales increased slightly in the Northeast, to 17,000 from 15,000 in June.
This article was written by Tuan Nguyen and originally appeared on 2022-08-23.
2022 RSM US LLP. All rights reserved.
https://realeconomy.rsmus.com/new-home-sales-down-40-this-year-to-lowest-since-2016/
RSM US Alliance provides its members with access to resources of RSM US LLP. RSM US Alliance member firms are separate and independent businesses and legal entities that are responsible for their own acts and omissions, and each is separate and independent from RSM US LLP. RSM US LLP is the U.S. member firm of RSM International, a global network of independent audit, tax, and consulting firms. Members of RSM US Alliance have access to RSM International resources through RSM US LLP but are not member firms of RSM International. Visit rsmus.com/about us for more information regarding RSM US LLP and RSM International. The RSM logo is used under license by RSM US LLP. RSM US Alliance products and services are proprietary to RSM US LLP.
Fitts, Roberts, Kolkhorst & Co., P.C. is a proud member of the RSM US Alliance, a premier affiliation of independent accounting and consulting firms in the United States. RSM US Alliance provides our firm with access to resources of RSM US LLP, the leading provider of audit, tax and consulting services focused on the middle market. RSM US LLP is a licensed CPA firm and the U.S. member of RSM International, a global network of independent audit, tax and consulting firms with more than 43,000 people in over 120 countries.
Our membership in RSM US Alliance has elevated our capabilities in the marketplace, helping to differentiate our firm from the competition while allowing us to maintain our independence and entrepreneurial culture. We have access to a valuable peer network of like-sized firms as well as a broad range of tools, expertise and technical resources.
For more information on how Fitts, Roberts, Kolkhorst & Co., P.C. can assist you, please contact us.