Residential Housing Sales Are Up!.... October 23, 2006
Finally, Good News for Housing
October 2006

In a somewhat surprising upswing, sales of new single-family homes logged a 4.1 percent increase in August to reach a seasonally adjusted rate of 1.05 million units. The hike, however, follows substantial downward revisions to the sales rates for the previous three months, according to figures released by the U.S. Commerce Department.

Although the preliminary sales pace was down more than 17 percent from a year ago, economists are encouraged by the recent surge.
“The bounce-back in new home sales certainly is a welcome development, although the reported increase was from a downward-revised July level that was the lowest reading since March 2003,” says David Seiders, NAHB chief economist. “Many builders still have large inventories of unsold homes, and we expect to see aggressive use of sales incentive over the balance of the year.”

With the exception of the West, which was down 17.7 percent for the month, most regions of the country saw increases in the pace of new home sales in August. The Northeast was up 21.7 percent, the Midwest up 12.2 percent and the South up 11.1 percent, according to Commerce Department figures. Still, all regions had significantly lower sales than the comparable period last year.

“The sales increase for August reported by the government was somewhat surprising,” says David Pressly, a homebuilder from Statesville, NC, who serves as NAHB’s president. “However, mortgage rates have been coming down from mid-year levels and many builders are offering substantial incentives to bolster sales, making this a good time to buy.”
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