New home sales increase in January

Home COVID-19 COVID-19-home New home sales increase in January

Washington, D.C.—Strong demand stemming from low interest rates, favorable demographics and a suburban shift for home building to smaller, more affordable housing markets helped to lift new home sales in January. But rising lumber and material costs threaten to blunt the momentum, according to the National Association of Home Builders (NAHB).

Sales of newly built, single-family homes in January rose 4.3% to a 923,000 seasonally adjusted annual rate, according to newly released data by the U.S. Department of Housing and Urban Development and the U.S. Census Bureau.

“Historically low mortgage rates and solid demand spurred an increase in new home sales in January, with the sales pace more than 19% higher than a year ago,” said NAHB chairman, Chuck Fowke, a custom home builder from Tampa, Fla. “However, rising affordability issues are looming this year, particularly increasing building material costs, including lumber, which is adding $24,000 to the price of a typical newly-built home. Builders also cite rising regulatory issues as a potential concern.”

“With existing home inventory at all-time lows, the demand for new construction remains strong,” said Robert Dietz, NAHB chief economist. “Though, rising building and development costs, combined with recent increases in mortgage interest rates, threaten to exacerbate existing affordability conditions. Builders are exercising discipline to ensure home prices do not outpace buyer budgets.”

A new home sale occurs when a sales contract is signed or a deposit is accepted. The home can be in any stage of construction: not yet started, under construction or completed. In addition to adjusting for seasonal effects, the January reading of 923,000 units is the number of homes that would sell if this pace continued for the next 12 months.

Inventory remains low at just a four-month supply, with 307,000 new single-family homes for sale, 6.3% lower than January 2020.

The median sales price was $346,400, up 5.3% from the $328,900 median sales price posted a year earlier.

Regionally, new home sales declined 13.9% in the Northeast, and rose in the other three regions, up 12.6% in the Midwest, 3% in the South and 6.8% in the West.

Must Read

Footprints Floors launches The First Fruits Fund

Littleton, Colo.—Footprints Floors, a 160-plus-unit flooring franchise, said it prides itself on being an organization that believes in the greater good. The brand recently...

TDG announces digital strategy for 2023

Dalton—The Dixie Group (TDG) has unveiled its digital strategy for 2023, which includes enhancing its digital capabilities by partnering with several companies to create...

Stanton removes hard surface freight surcharges

Woodbury, N.Y—Stanton has removed hard surface freight surcharges for DWF and Vanguard Flex beginning with shipped orders Monday, Dec. 5. "We hope this will make...

Karndean launches new Opus visuals

Export, pa.— Karndean Designflooring introduced new commercial market-exclusive abstract visuals in varying size formats. The company said these visuals are designed to interact with...

Retailers React: What’s your strategy for finding new installers?

Every two weeks, FCNews seeks out flooring retailers across the country to offer their advice on hot topics of the day. This week we...

Happy Feet, Welspun partner on charitable product offering

Dalton—Happy Feet International is expanding its offerings to include new products from Welspun Flooring where a portion of every Welspun sale will go toward...
Some text some message..
X