New single-family home sales for November came off a record October buying surge, dropping to a seasonally adjusted annual rate of 1.125 million units, the U.S. Commerce Department reported.
Despite a 12.0 percent decline from October's record sales pace, the November rate was 3.6 percent above the sales pace of November 2003.
The government revised October's single-family home sales pace upward to 1.278 million units, and the October to November average is above the pace for the first three quarters of the year.
“The fundamentals supporting housing demand still are quite solid. Mortgage rates are historically low, job growth is moving ahead and household income is rising,” said NAHB Chief Economist David Seiders. “Sales of new single-family homes will hit a record in 2004 despite the surprising decline reported for November.”
The inventory of new homes for sale moved up 2.2 percent to 418,000 units in November. This represents a 4.5 month supply at the current sales rate, the highest since early 2003. However, the rise in the inventory of unsold new homes entirely reflected homes that have been permitted but not yet started. The inventory of homes under construction or completed was virtually unchanged.
Sales in the Northeast, Midwest, and West declined for the month. The Northeast dropped 7.1 percent, the Midwest posted a 39.4 percent decline, and the West fell 27.9 percent. Sales in the South increased 13.6 percent for the month.
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