January came out of the gates slower than 2021 when it came to new single-family home sales, according to the latest report from the U.S. Census Bureau and U.S. Department of Housing and Urban Development (HUD). The annually adjusted rate was recorded at 801,000, which represents a 4.5% lower rate than December 2021 and 19.3% versus January 2021 (993,000).
Additional findings:
- The median sale price of a new home sold in January 2022 was $423,300, while the average sale price was $496,900.
- The seasonally adjusted estimate of new houses for sale at the close of January was 406,000. This marks a supply of 6.1 months assuming the current rate of sales.
The takeaway:
“While homebuyers facing a record low number of existing homes for sale turned to new construction to help them secure a home and lock in a mortgage rate before costs rise even more, fast-rising prices are already a stumbling block for some, said Danielle Hale, chief economist at realtor.com®. Even though builder confidence has slipped from recent highs due to supply chain challenges and rising materials costs, total permits continue to hit new highs, suggesting that some inventory relief is on the way for those with flexible timing. Only roughly 1 in 10 new homes for sale is already completed, so patience is essential.
Reflecting high demand amid rising costs, the median sales price for new homes jumped 13.4% from one year ago even as seasonally adjusted supply improved to 6.1 months. Just 8% of new homes sold in January were priced below $300,000, compared to 26% one year earlier.
Looking ahead, the surge in mortgage rates is likely to propel urgency over the next few months before eventually sapping some momentum from the housing market as buyers figure out how to afford the higher monthly costs that accompany higher prices and mortgage rates. We expect to see the inventory of homes available for sale begin to grow in 2022 from record-low levels as construction gives buyers new options, and existing homeowners venture into the housing market.”
To see full data tables, visit: https://www.census.gov/construction/nrs/pdf/newressales.pdf
