US New Home Sales: Uptrend remains in place despite August’s decline - Wells Fargo

According to analysts from Wells Fargo, new home sales give back part of July’s gains in August but noted that the upward trend remains in place.

Key Quotes:

“New home sales were widely expected to give back part of July’s big gain and came in close to consensus expectations. Sales fell 7.6 percent in August to an annual rate of 609,000 units.”

“Small revisions to the prior three months’ data slightly reduced sales in May and June but showed that sales rose even more dramatically in July. On net, the revisions show the annual sales pace over the past three months was 4,000 less than previously reported. Despite that reduction, the upward trend in new home sales remains firmly in place.”

“Demand seems to be holding up relatively well for more modestly priced homes, however, which has contributed to the moderation in the median home price. The new home market continues to be supply constrained.  Builders currently have just a 4.6-month supply of homes available for sale at the most recent sales pace. Moreover, much of that inventory is either under construction or not yet started. Only 56,000 completed new homes are available for sale across the country, which remains near its historic low.”