Last month, new U.S. single-family home sales recorded their largest fall in almost a year after jumping to nine-year highs the month prior, with analyst reporting the trend in sales remains optimistic. The Commerce Department noted on Monday new home sales dropped 7.6 percent to a seasonally adjusted annual rate of 609,000 units last month. Sales increased 20.6 percent from a year ago.
Economists polled had expected single-family home sales, which account for nearly 10 percent of all home sales, dropping to a rate of 600,000 units last month. July’s sales rate was changed up 5,000 units to 659,000 units. That level of annualized sales is the highest in almost nine years.
“New home sales moved lower in August, but sales were at an expansion high in July and the longer-term trend remains positive due to strong homebuyer demand,” stated David Berson, chief economist at Nationwide and former chief economist at Fannie Mae.
Shares in homebuilders saw no change after the data, outperforming the broader stock market, which decreased about half a percent. Another housing report last week displayed a firm increase in permits for single-family dwellings as the housing market continues to strengthen overall amid a firming labor market that is boosting wages.
New home sales have also helped from a shortage of previously owned houses available for sale. In August, the inventory of new homes on the market increased 1.7 percent to 235,000 units. New single-family home sales dropped 34.3 percent in the Northeast to the lowest level since September 2015. Sales declined 2.4 percent in the Midwest and 12.3 percent in the South but increased 8.0 percent in the West to the highest level since September 2007.