Added NAHB’s chief economist, Robert Dietz: “April saw an increase in new home sales as buyers sought new construction even as builders struggle to keep up with demand because of a shortage of distribution transformers and skilled construction workers,” he said. “Sales for 2023 thus far are still down 9.7% on a year-to-date basis due to elevated interest rates, and sales may weaken in the months ahead given the recent rise in interest rates.”
The group defines a new home sale as occurring when a sales contract is signed, or a deposit is accepted. The home can be in any stage of construction: not yet started, under construction or completed, according to the NAHB’s definition. In addition to adjusting for seasonal effects, NAHB added, the April reading of 683,000 units is the number of homes that would sell if this pace continued for the next 12 months.
Median new home sales prices fall
New single-family home inventory increased 0.2% in April and remained elevated at a 7.6 months’ supply at the current building pace, according to the findings. A measure near a six months’ supply is considered balanced but the lack of resale, existing home inventory means that overall inventory for the single-family market remains tight, NAHB said.
The median new home sale price fell in April to $420,800 and was down 8% compared to a year ago. The report showed growth in the lower price ranges, with 9,000 sales in the $200,000-$299,999 price range in April 2023, compared to just 4,000 sales a year prior. The $300,000-$399,999 price bracket grew by 14,000 sales in that same time frame.
Regionally, on a year-to-date basis, new home sales fell in all regions, down 19.2% in the Northeast, 9.8% in the Midwest, 0.7% in the South and 27.5% in the West.