New home sales up unexpectedly in April
New home sales in the United States increased 3.3 percent in April to an annual pace of 526,000 from a 509,000 rate in March, the U.S. Commerce Department announced May 27. Still, that number was down 42 percent from a year ago, the largest year-over-year drop in almost 27 years.
The increase in sales was the first since October, but it was revised down from the previous month, signaling that the housing slump has yet to reach bottom.
Also included in the report was the following: the median sales price of new houses sold in April 2008 was $246,100, down 4.2 percent from a year ago, and the seasonally adjusted estimate of new houses for sale at the end of April was 456,000 — the 12th straight monthly decline. The April sales pace put the supply of homes available for sale at 10.6 month’s worth.
“The fact that new home sales are up slightly from a dismal beginning to the spring home buying season in March isn’t much to celebrate,” said Sandy Dunn, president of the National Association of Home Builders (NAHB).
Part of the reason for the muted attitude toward the numbers — April’s sales pace of 526,000 units actually was equal to the previously reported sales pace in March, but the Commerce Department revised the March pace downwardly to 509,000 units. That new March figure is 11 percent below February’s reading.
In all, sales rose in three out of four regions in April. The Northeast posted a 41.7 percent gain that “erased” an equivalent decline in the previous month, while the Midwest and West recorded gains of 5.8 percent and 8.3 percent, respectively. The South, which is the nation’s largest housing market, the NAHB notes, posted a 2.4 percent decline.
Year-round barbecue grilling on the rise
With another Memorial Day weekend winding down, it’s worth noting that more consumers are using their grills year-round, according to recent research from NPD Group.
As part of the group’s annual “Eating Patterns in America” report, the research firm identified that usage of outdoor grills is at an “all-time high” and nearly double what it was 20 years ago. In 1985, when the survey first started, 17 percent of households used a grill at dinner at least once during an average two-week period throughout the year; in 2007, it was 38 percent.
“While summer still accounts for the highest consumption levels of grilled food, grilling has increased the most in the other seasons of the year,” says Harry Balzer, a vp at NPD Group and author of the eating trends report.
Broken down by seasons, grill usage patterns are as follows:
• Grill usage in the spring months of March through May was 37.2 percent in 2007, up from 31.4 percent in 1998.
• The number predictably spikes in the summer, at 49.3 percent in the months of June through August 2007, up from 46.3 percent in 1998.
• Grill usage in the fall months has risen most dramatically, to 39.9 percent in 2007 from 30.3 percent in 1998.
• Use of grills also is up in the winter months of December through February, to 26.5 percent in 2007 from 18.7 percent in 1998.
• Total usage for all four seasons in 2007 was 38.2 percent, up from 31.7 percent in 1998.
The majority of households have an outdoor grill (76 percent), and the grill of choice is one that uses gas — 75 percent of grill owners have a gas grill. In 2007, NPD estimates grill sales grew by 3.2 percent (unit sales) from the previous year.
Existing-home sales fell last month
Existing-home sales fell 1 percent month-over-month in April, to a seasonally adjusted annual rate of 4.89 million units from an upwardly revised pace of 4.94 million in March, according to the National Association of Realtors. Sales of existing homes were 17.5 percent below the 5.93 million-unit level in April 2007.
“In the past week, Freddie Mac and Fannie Mae announced that they were eliminating their ‘declining market’ policies, effective June 1,” said NAR president Richard F. Gaylord, voicing some optimism on the downturning market. “This means consumers across the country will have access to safe, affordable financing with down payments of only 5 percent on most mortgages, with 100 percent financing available on some loan products, and we could see an upturn in home sales this summer.”
The national median existing-home price for all housing types was $202,300 in April, 8 percent below a year ago when the median was $219,900.
Total housing inventory at the end of April rose 10.5 percent to 4.55 million existing homes available for sale, which represents an 11.2-month supply at the current sales pace, up from a 10.0-month supply in March.
Single-family home sales slipped 0.5 percent to a seasonally adjusted annual rate of 4.34 million in April from 4.36 million in March, and are 16.1 percent below the 5.17 million-unit level recorded one year ago. The median existing single-family home price was $200,700 in April, down 8.5 percent from April 2007.
Existing condominium and co-op sales fell 5.2 percent to a seasonally adjusted annual rate of 550,000 units in April from 580,000 in March, and are 27.9 percent below the 763,000-unit pace in April 2007. The median existing condo price was $214,900 in April, which is 3.7 percent below a year ago.
Regionally, existing-home sales in the West rose 6.4 percent in April to a level of 1 million but are 15.3 percent below a year ago. In the South, existing-home sales were unchanged from March at an annual rate of 1.92 million in April, but are 18.6 percent below April 2007.
Existing-home sales in the Northeast fell 4.4 percent to an annual pace of 870,000 in April, and are 14.7 percent below a year ago. In the Midwest, existing-home sales were at an annual rate of 1.10 million in April, which is 6 percent below March and 19.7 percent lower than April 2007.