New home sales were better than expected in December 2024. Here are Reuters' main takeaways from the month's new home sales report from the U.S. Census Bureau:
- "Sales of new U.S. single-family homes increased more than expected in December, further evidence that housing market activity regained some momentum at the end of 2024, though rising mortgage rates remain a constraint."
- "New home sales rose 3.6% to a seasonally adjusted annual rate of 698,000 units last month, the Commerce Department's Census Bureau said. The sales pace for November was revised higher to a rate of 674,000 units from the previously reported 664,000 units."
- An estimated 683,000 new homes were sold in 2024, up 2.5% compared to 2023. The median new house price increased 2.1% to $427,000 in December from a year earlier. The pace of increase in home prices is slowing amid rising inventory of new homes.
The U.S. Census Bureau's sales data is preliminary and will be revised three more times during the next three months. Still, that preliminary look along with the revisions to previous months allows us to get a good sense of how the entire U.S. new home market fared through the end of 2024. The three following charts present the trends for the U.S. new home market capitalization, the number of new home sales, and their sale prices as measured by their time-shifted, trailing twelve month averages from January 1976 through the preliminary data for December 2024.
New home sales trending slowly upward:
Average sale prices remain elevated:
Our initial estimate of the time-shifted trailing twelve month average of the total value of new homes sold during December 2024 is $26.96 billion, which falls below November 2024's revised market cap estimate of $27.39 billion. The new home market cap remains more than 10% below its December 2020 level. The last four years have been lackluster ones for new home builders.
We'll take our next look at how affordable the new homes sold in December 2024 were in the near future.
References
U.S. Census Bureau. New Residential Sales Historical Data. Houses Sold. [Excel Spreadsheet]. Accessed 27 January 2025.
U.S. Census Bureau. New Residential Sales Historical Data. Median and Average Sale Price of Houses Sold. [Excel Spreadsheet]. Accessed 27 January 2025.
Image Credit: Construction framer working on new home by Josh Olalde on Unsplash.
Labels: real estate
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