New Home Sales: November 2007

Today, the U.S. Census Department released its monthly New Residential Home Sales Report for November showing a further deterioration of the already hideous falloff in demand for new residential homes both nationally and in every region as well as again reporting significant downward revisions to August, September and October’s results.

On a year-over-year basis new home sales are continuing to weaken, dropping a truly ugly 34.4% below the sales activity seen in November 2006 representing the largest year-over-year decline registered during this current housing bust.

It’s important to keep in mind that these declines are coming on the back of the significant declines seen in 2006 further indicating the significance of the housing bust.

It’s important to note that although inventories of unsold new homes have been dropping for eight straight months, the sales volume has been declining so significantly that the sales pace has now reached a near peak value of 9.3 months of supply.

The following charts show the extent of sales declines seen since 2006 as well as illustrating how the further declines in 2007 are coming on top of the 2006 results (click for larger versions)

Note that the last chart essentially combines the year-over-year changes seen in 2005, 2006 and 2007 and shows sales trending down precipitously as compared to the peak period.



Look at the following summary of today’s report:

National

• The median price for a new home was down .41% as compared to November 2006.
• New home sales were down 34.4% as compared to November 2006.
• The inventory of new homes for sale declined 6.8% as compared to November 2006.
• The number of months’ supply of the new homes has increased 43.1% as compared to November 2006.

Regional

• In the Northeast, new home sales were down 28.1% as compared to November 2006.
• In the West, new home sales were down 33.8% as compared to November 2006.
• In the South, new home sales were down 34.3% as compared to November 2006.
• In the Midwest, new home sales were down 38.7% as compared to November 2006.