New Construction: Buyers Face Squeeze Of Time And Mortgage Rates

The U.S. housing market continues to propel the broader economy ahead. According to the Department of Housing and Urban Development (HUD), sales of new construction homes nearly eclipsed a 4-year watermark last month.

U.S. buyers are feeling better about the economy, and they’re jumping to buy affordable homes.

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Big Demand For Newly-Built Homes

Sales of newly-built homes is rising. On a seasonally-adjusted, annualized basis, the number of new homes sold in April 2013 reached 454,000, a 2 percent increase from the month prior and a 29% improvement from April of last year.

A “new home” is a home which has not been previously occupied.

April also marked the fourth consecutive month in which new home sales topped four-hundred-thousand. This is a winning streak unmatched since late-2008 which suggests that U.S. housing is returning to pre-recession levels.

Also notable is that new home sales are climbing despite a depressed inventory.

At the end of April 2013, there were an estimated 156,000 new homes available for purchase. This is a small increase from the month prior, but well below historical norms. At the current pace of home sales, the entire U.S. stock of newly-built homes would be sold out by Labor Day.

There is current a 4.1-month new home supply. Home supplies of 6.0 months or fewer suggest a “seller’s market”. Buyers of new homes can reasonably expect higher home prices through the second half of 2013 and into 2014.

http://themortgagereports.com/12987/new-construction-buyers-face-squeeze-of-time-and-mortgage-rates

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Realtor with Greg Garrett Realty, actively licensed in the state of Virginia

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