Sales of new
single-family houses in September 2022 were at a seasonally adjusted annual
rate (SAAR) of 603,000 units (585,000 expected). This is 10.9% (±15.2%)* below the revised
August rate of 677,000 (originally 685,000 units) and 17.6% (±15.9%) below the
September 2021 SAAR of 732,000 units; the not-seasonally adjusted (NSA)
year-over-year comparison (shown in the table above) was -15.5%. For
longer-term perspectives, NSA sales were 56.6% below the “housing bubble” peak
and 6.3% below the long-term, pre-2000 average.
The
median sales price of new houses sold in September 2022 was $470,600 (+8.0%, or
$34,800). The average sales price was $517,700
(-2.1% or $11,300). Homes priced at/above $750,000 were 12.2% of sales, up from
the year-earlier 10.3%.
* 90% confidence interval includes zero. The Census Bureau does not have sufficient statistical evidence to conclude that the actual change is different from zero.
As mentioned in our post about housing permits, starts and completions in September, single-unit completions jumped by 33,000 units (+3.2%). Sales fell (74,000 units), resulting in inventory for sale expanding on both absolute (+5,000 units) and months-of-inventory terms (+1.1 months).
Existing home sales retreated for an eighth month in September (-1.5% or 70,000 units) to a SAAR of 4.71 million units (in line with expectations). Inventory of existing homes for sale contracted in absolute terms (-30,000 units) but was unchanged on a months-of-inventory basis. Because resales retreated less than new-home sales, the share of total sales comprised of new homes dipped to 11.3%. The median price of previously owned homes sold in September slipped to $384,800 (-1.8% or $6,900).
Housing affordability nudged higher (+4.8 index points) as the median price
of existing homes for sale in August fell by $9,500 (-2.3% MoM; +7.6 YoY) to $396,300.
Concurrently, Standard & Poor’s reported that the U.S. National Index in the S&P Case-Shiller
CoreLogic Home Price indices declined at a not-seasonally adjusted monthly change
of -1.1% (+13.0% YoY).
“The
forceful deceleration in U.S. housing prices that we noted a month ago
continued in our report for August 2022,” said Craig
Lazzara, Managing Director at S&P DJI. “For example, the National
Composite Index rose by 13.0% for the 12 months ended in August, down from its
15.6% year-over-year growth in July. The -2.6% difference between those two
monthly rates of change is the largest deceleration in the history of the index
(with July’s deceleration now ranking as the second largest). We see similar
patterns in our 10-City Composite (up 12.1% in August vs. 14.9% in July) and
our 20-City Composite (up 13.1% in August vs. 16.0% in July). Further, price
gains decelerated in every one of our 20 cities. These data show clearly that
the growth rate of housing prices peaked in the spring of 2022 and has been
declining ever since.
“Month-over-month
comparisons are consistent with these observations. All three composites
declined in July, as did prices in every one of our 20 cities. On a
month-over-month basis, the biggest declines occurred on the west coast, with
San Francisco (-4.3%), Seattle (-3.9%), and San Diego (-2.8%) falling the most.
“Despite
the ongoing deceleration, August’s housing prices remain well above year-ago
levels in all 20 cities. Florida continues to hold the top two spots, with
Miami (+28.6%) taking the lead over Tampa (+28.0%). This month, Charlotte
(+21.3%) edged out Dallas (+20.2%) and Atlanta (+20.1%) for third position.
Price growth continued strongest in the Southeast (+24.5%) and South (+23.6%).
“As the Federal Reserve moves interest rates higher, mortgage financing becomes more expensive and housing becomes less affordable. Given the continuing prospects for a challenging macroeconomic environment, home prices may well continue to decelerate.”
The foregoing comments represent the general economic views and analysis of Delphi Advisors, and are provided solely for the purpose of information, instruction and discourse. They do not constitute a solicitation or recommendation regarding any investment.
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