New home sales drop to 603,000 annual rate in September

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by Risk calculated on 26/10/2022 10:09:00

The Census Bureau reports that new home sales in September were at a seasonally adjusted annual rate (SAAR) of 603,000.

The prior three months were revised lower, combined.

Sales of new single-family homes in September 2022 hit a seasonally adjusted annual rate of 603,000, according to estimates released jointly today by the US Census Bureau and the Department of Housing and Urban Development. That’s 10.9% below August’s revised rate of 677,000 and 17.6% below the September 2021 estimate of 732,000.
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Click on the graphic to enlarge the image.

The first chart shows new home sales versus recessions since 1963. The dotted line represents the current sales rate.

New home sales are below pre-pandemic levels.

The second graph shows months of supply of new homes.

New Home Sales, Months of SupplyMonths of supply increased in September to 9.2 months from 8.1 months in August.

The all-time high was 12.1 months of supply in January 2009. The all-time high was 3.5 months, most recently in October 2020.

This is well above the high end of the normal range (around 4-6 months supply is normal).

“The seasonally adjusted estimate of new homes for sale at the end of September was 462,000. This represents 9.2 months of supply at the current sales rate.”

New Home Sales, NSAThe last chart shows NSA sales (monthly sales, unadjusted annual rate).

In September 2022 (red column), 49,000 new homes were sold (NSA). Last year, 58,000 homes were sold in September.

The September all-time high was 99,000 in 2005 and the September all-time low was 24,000 in 2011.

It was slightly above expectations, but sales for the previous three months were revised lower, combined. I’ll have more later today.

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