The Census Bureau reports New Home Sales in March were at a seasonally adjusted annual rate (SAAR) of 511 thousand.
The previous three months were revised up by a total of 23 thousand (SAAR).
“Sales of new single-family houses in March 2016 were at a seasonally adjusted annual rate of 511,000, according to estimates released jointly today by the U.S. Census Bureau and the Department of Housing and Urban Development. This is 1.5 percent below the revised February rate of 519,000, but is 5.4 percent above the March 2015 estimate of 485,000.”
The first graph shows New Home Sales vs. recessions since 1963. The dashed line is the current sales rate.
Even with the increase in sales since the bottom, new home sales are still fairly low historically.
The second graph shows New Home Months of Supply.
The all time record was 12.1 months of supply in January 2009.
This is now in the normal range (less than 6 months supply is normal).
“The seasonally adjusted estimate of new houses for sale at the end of March was 246,000. This represents a supply of 5.8 months at the current sales rate.”
On inventory, according to the Census Bureau:
“A house is considered for sale when a permit to build has been issued in permit-issuing places or work has begun on the footings or foundation in nonpermit areas and a sales contract has not been signed nor a deposit accepted.”
Starting in 1973 the Census Bureau broke this down into three categories: Not Started, Under Construction, and Completed.
The third graph shows the three categories of inventory starting in 1973.
The inventory of completed homes for sale is still low, and the combined total of completed and under construction is also low.
In March 2016 (red column), 48 thousand new homes were sold (NSA). Last year 46 thousand homes were sold in March.
The all time high for March was 127 thousand in 2005, and the all time low for March was 28 thousand in 2011.
This was below expectations of 522,000 sales SAAR in March, however prior months were revised up. A decent report. I’ll have more later today.