US New Home Sales: Prices appear to have moderated – Wells Fargo

Sales of new homes climbed 1.3% in November according to data released today. Wells Fargo’s analysts point out sales are up 9.8% from last year on a year-to-date basis. They see homebuilders are focusing more on entry-level housing, which is why the median prices has risen so modestly this year.

Key Quotes: 

“New home sales rose 1.3% in November to an annualized pace of 719,000. Although this level of sales was not quite as strong as expected, strength in the NAHB/Wells Fargo Homebuilders.”

“The median price of a new home has risen 7.2% over the past year. New home price increases have been moderating for much of the year, as more building is focused on entry-level homes in more affordable parts of the country.”

“Housing demand appears to have strengthened. Homebuilder confidence has risen to its highest level since 1998 and the present sales index jumped 7 points to 84 in December to a new cycle high.”