Data released Friday showed that new home sales rose 1.5% in August, versus expectations of a modest decline. According to Wells Fargo analysts, Sales have cooled off compared to the feverish pace seen in late 2020 and early 2021, but they argue that despite some recent moderation, the overall pace of sales remains very strong relative to before the pandemic.
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“New home sales increased 1.5% to a rate of 740,000 units during August. The modest pickup in sales continues to show that underlying demand for homes remains strong. The slight pullback in sales experienced this spring and early summer likely had more to do with builders struggling to build enough homes to show potential buyers. It’s challenging to sell a home when you can’t tell the buyer when it will be done. “
“Timber prices have fallen from the exorbitant levels seen this spring. However, other key building materials remain in short supply, delaying new starts and preventing projects from being completed. A rebound in the already elevated NAHB / Wells Fargo Housing Market Index (HMI) for the month of September, released separately this week, provides additional evidence that homebuilders remain overwhelmingly optimistic, even with headwinds. on the supply side. “
“The rate of 740,000 units registered during the month is the fastest since April. Sales have cooled off compared to the feverish pace seen in late 2020 and early 2021. Despite some recent moderation, the overall sales pace remains very strong relative to before the pandemic. By context, 683,000 new homes were sold in 2019 ”.
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