For agents and brokers, news that fewer new homes were sold in December isn’t necessarily something that clients seeking that dream home should be too concerned about.
According to a joint report by the U.S. Census Bureau and U.S. Department of Housing and Urban Development. December sales of new homes were up 14.1 percent year-over-year even as there was a 9.3 percent monthly drop in newly constructed home sales, totaling 625,000 in December.
REALTOR.com examined seasonally adjusted numbers in the report. These have been smoothed out over 12 months to account for seasonal fluctuations in the market.
Just like existing housing data, the monthly decline in new home sales is thanks to a blockbuster November.
“Sales were unusually high in the previous two months, which means that sales dropped in December because people had [already] bought their homes,” says Joseph Kirchner, senior economist at realtor.com.
The biggest number of sales were in the South, at 331,000, and they were down 9.8 percent from November. They were up, however, 15.7 percent from the previous December.
The South was followed by the West, at 190,000. They were down 9.5 percent over the previous month but up 18.8 percent over the same period last year.
In the Midwest, there were 63,000 sales, down 10 percent monthly and showing a 3.1 percent annual drop. There were only 41,000 sales in the Northeast. They were down 2.4 percent from November, but up 10.8 percent from the previous year.
Nationally, the median price of a new home was $335,400 in December, according to the report.
“Affordability continues to be a problem,” Kirchner says. “In general, new home construction is focused on more expensive homes.”
According to the data, just 4 percent of the new homes sold in December were $150,000 or under. An additional 13 percent were between $150,000 and $199,999. A majority of the sales, about 47 percent, were of residences costing $200,000 to $399,999. About 11 percent of homes sold went for $400,000 to $499,999.
New homes costing $500,000 and up made up the second-largest chunk of sales, at 25 percent.