New Home Sales Decline Over 11 Percent After Big Upward Revision

Tyler Mitchell By Tyler Mitchell Jun27,2024 #finance

Data reports are so wild with huge revisions that it is hard to believe any of them.

New Home Sales from Census Department, chart by Mish

Last month I reported New Home Sales Sink 4.7 Percent on Top of Huge Negative Revisions

This month we see a big upward revision to May from 634,000 to 698,000 coupled with an 11.3 percent dive from the revision.

New Residential Construction

Today, the Census Department released a third consecutive heavily revised New Residential Construction report.

  • New Home Sales: Sales of new single-family houses in May 2024 were at a seasonally adjusted annual rate of 619,000.
  • This is 11.3 percent (±15.5 percent) below the revised April rate of 698,000 and is 16.5 percent (±16.2 percent) below the May 2023 estimate of 741,000.
  • Sales Price: The median sales price of new houses sold in May 2024 was $417,400. The average sales price was $520,000.
  • For Sale Inventory and Months’ Supply: The seasonally-adjusted estimate of new houses for sale at the end of May was 481,000. This represents a supply of 9.3 months at the current sales rate.

Note the margins of error in this report, 15 percent and higher.

Third Big Revision

Here’s my headline from April 23, 2024: New Home Sales Rise 8.8 Percent After 3.8 Percent Negative Revision

The Census Bureau revised February seasonally adjusted annualized sales from 662,000 to 637,000 and reports March at 693,000. Expect more revisions.

“Expect more revisions.” Indeed.

New Home Sales Since 1963

New home sales are well below the February 1964 report (yellow highlights).

Who can afford them? Prices are at record levels and mortgage rates are holding just over 7.00 percent according to Mortgage News Daily.

New Homes For Sale By Stage of Construction

Allegedly, there are 481,00 homes for sale but 104,000 of them have not been started.

278,000 homes under construction and 104,000 are complete.

There are 377,000 homes started or completed, 378,000 last month. That is the most since May of 2008. Good luck with that at these mortgage rates, currently 7.03 percent.

New Homes for Sale Supply

From a fictitious number of new homes for sale of which 104,000 have not even been started, and a questionable and likely to be revised number of sales, the Census Bureau calculates a fictitious supply of 9.3 months.

Existing-Home Sales

Existing-home sales courtesy of the National Association of Realtors (NAR)

For discussion, please see Existing Home Sales Drop Slightly But Median Price Hits New Record

Existing-home sales declined 0.7 percent in May. It was the 22nd decline in 28 months. But the median price hit a new record.

The Case-Shiller Home Price Index Hits Another New Record

Housing affordability continues to soar out of reach of most buyers. Not only are prices at a new record level, mortgage rates remain slightly above 7.0 percent.

Image courtesy of Case-Shiller and the BLS, chart by Mish

For discussion, please see The Case-Shiller Home Price Index Hits Another New Record

Tyler Mitchell

By Tyler Mitchell

Tyler is a renowned journalist with years of experience covering a wide range of topics including politics, entertainment, and technology. His insightful analysis and compelling storytelling have made him a trusted source for breaking news and expert commentary.

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