The U.S. Commerce Department announced that new home sales in the United States in June rose by the largest amount in nearly nine years. Commentators this morning are taking this as “another sign the housing market was bouncing back from the worst downturn in decades.” New York Times.
“Bounce” is not a word I would use, at least not yet in Flagstaff, where you can still see abandoned new home projects and the only permits being pulled – and very few at that – are for individual custom homes. City of Flagstaff Building Permits, June 2009. Tracking of permits is done separately from tracking of new home sales by the U.S. Commerce Department. See the June national report on new building permits here. Of course, a precursor of a rise in new permits is clearing out the excessive inventory by continued increases in new home sales.
Nationally, new home sales rose 11 percent in June to a seasonally adjusted annual rate of 384,000, from an upwardly revised May rate of 346,000, the Commerce Department said. Looking at the chart released with the report, shown on the right here, you have to squint to see what the commentators are calling a "bounce," but it is indeed there.
It was the strongest sales pace since November 2008 and exceeded the forecasts of economists surveyed by Thomson Reuters and MarketWatch.com, who expected a pace of 360,000 or 355,000 homes, respectively. The last time sales rose so dramatically was in December 2000, at what seem see as the beginning of a “bubble” in housing.
New home sales have risen for three consecutive months. Notably, the median sales price of $206,200 was down 12 percent from $234,300 a year earlier. The law of supply and demand works again!
The real estate market, like all markets, is cyclical. This cycle has been tougher than some in the past. The real estate market will come back. If you are a long term investor or someone looking to live in a Flagstaff home, now is the time to buy.
To buy or sell any Flagstaff home, contact us: Team Heitland at RE/MAX Peak Properties.
To search the Flagstaff MLS, click here!
Click here to see our featured Flagstaff home listings. | 
-->
Email to a Friend
