ETFs To Shine As U.S. New Home Sales Hit 13-Year High

The latest new home sales data is encouraging as sales of newly-built, single-family homes rose to the highest in July since December 2006 in the United States. Per the Commerce Department data, new home sales rose 13.9% in July to a seasonally adjusted annual rate of 901,000 units. This compares favorably with June’s sales pace that was revised to 791,000 units. Year over year, new home sales rose 36.3% in July from the year-ago estimate of 661,000. It is being believed that the housing market is getting support from low mortgage rates and changing demand patterns with increasing preference for houses in low-density residential locations amid the coronavirus outbreak. As more employees are being allowed to work remotely, the demand for a house in a less-populated location is increasing among the masses, per a Reuters article.

New home sales, which make for 13% of housing market sales, rose in the Midwest, South and West but declined in the Northeast. Notably, there was a 7.2% year-over-year rise in median new house price to $330,600 in July, per a Reuters article.

Commenting on the data, Robert Dietz, Chief Economist of the National Association of Home Builders (NAHB) said that, “new home sales are benefitting from the suburban shift, as prospective buyers seek out affordable markets in order to obtain more residential space. Moreover, sales are increasingly coming from homes that have not started construction, with that count up 34 percent year-over-year. In contrast, sales of completed, ready-to-occupy homes are down almost 24 percent. These measures point to continued gains for single-family construction ahead," per THE WORLD PROPERTY JOURNAL article.

Is Housing Market Sizzling With Opportunities?

The recently-released data on U.S. builder confidence was upbeat as well. Per the monthly NAHB/Wells Fargo Housing Market Index (“HMI”), builder confidence for newly-built single-family homes surged to 78 points in August from 72 in July, 58 in June, 37 in May and 30 in April (the lowest since June 2012). The metric also surpassed analysts’ expectations of the reading, rising to 73, per a Reuters’ poll. Going on, August’s reading was the highest in the 35-year long history of the index, matching the December 1998 record. Notably, any reading above 50 is considered positive and signals at improving confidence.

1 2 3
View single page >> |

Disclosure: Zacks.com contains statements and statistics that have been obtained from sources believed to be reliable but are not guaranteed as to accuracy or completeness. References to any specific ...

more
How did you like this article? Let us know so we can better customize your reading experience. Users' ratings are only visible to themselves.

Comments

Leave a comment to automatically be entered into our contest to win a free Echo Show.