Existing Home Sales rebounded last month after a lackluster July. New Home Sales data, by contrast, did not.
After an upward revision to July’s data, New Home Sales remained unchanged at 288,000 units in August. It marks the second-lowest number of units sold in a month since 1963, the year government started its record-keeping.
At the current pace of sales, the newly-built home inventory would be depleted in 8.6 months.
The August New Home Sales was weaker-than-expected, but both Wall Street investors and Main Street economists are shrugging it off. The numbers were foreshadowed by weakening housing figures from earlier this summer.
- Building Permits dropped between March and June
- Housing Starts dropped between April and July
- Homebuilder confidence continues to sag
Together, these three data points suggest that the market for new homes will be soft through at least this month.
With New Home Sales fading and colder months ahead, it may be an opportune time for home buyers to look at new construction. Builders are eager to move inventory and the cost of materials remains low.
Buying “new” may never be cheaper — especially with mortgage rates as low as they are. The 0.750 percent drop in rates since January has shaved $188 off of a $200,000 mortgage’s monthly cost. That’s $2,250 per year in savings.
As home supplies dwindle and mortgage rates rise, finding “great deals” in new construction will undoubtedly get tougher. Take advantage of today’s market conditions, combined with builder pessimism. It may be the right combination at the right time to get that new home for cheap.