New Home Sales Slow Slightly in September
Sales of newly built, single-family homes in September fell 3.5% to 959,000 from a downwardly revised August number, according to newly released data by the U.S. Department of Housing and Urban Development and the U.S. Census Bureau.
Despite the monthly decline, the September rate is 32.1% higher than the September 2019 pace, and on a year-to-date basis, new home sales are up 16.9% in 2020.
Inventory inched up to a 3.6 months’ supply, with 284,000 new single-family homes for sale, 32.1% lower than August 2019. This is the third consecutive month with inventory running under four months’ supply. Of the inventory total, just 48,000 are completed, ready to occupy.
These inventory numbers point to additional construction gains ahead, as indicated by record levels of the NAHB/ Wells Fargo Housing Market Index.
A new home sale occurs 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.
The median sales price was $326,800. The median price of a new home sale a year earlier was $315,700.
Regionally, on a year-to-date basis new home sales were up in all four regions: 22.5% in the Northeast, 25.9% in the Midwest, 14.4% in the South, and 18% in the West.
ICC Rules on NAHB's Final Two Appeals
The ICC Board of Directors in October issued a final decision on the last two NAHB appeals to the 2021 building code development process. The board sided with NAHB on the scope and intent of two changes to the International Energy Conservation Code (IECC) but rejected another appeal on 20 twice-defeated proposals that were defeated at two different hearings before being approved in the online vote.
Sales Outpacing New Home Construction
The home building industry has made a quick and dramatic comeback in the wake of the COVID-induced economic downturn. Housing demand has increased so rapidly in recent months that there is now an unprece- dented gap between sales and home construction.
Sales of new single-family homes in August increased 4.8% to an annual rate of 1.01 million units — their highest pace since September 2006.
Hits Another Record
In a further show of strength for the housing sector, builder confidence in the market for newly-built single-family homes increased two points to 85 in October, further surpassing the previous all-time high of 83 recorded in September, according to the latest NAHB/Wells Fargo Housing Market Index (HMI). These are the first two months the index has ever been above 80.
Builders have noted that traffic remains high and record-low interest rates are keeping demand strong.
NGBS Sees 250,000th Certified Home
The National Green Building Standard (NGBS) Certification Program reached a key milestone in October with the certification of its 250,000th home, the Broadstone Junction multifamily community in historic Norcross, Ga.
Since the NGBS Green Certification Program began in 2009, it has provided builders with a national standard to define and measure sustainable multifamily and single-family homes, developments and remodeling projects.
DCW to Be All-Virtual, Feb. 9-12
Due to health and safety concerns related to the COVID-19 pandemic, NAHB and the National Kitchen & Bath Association (NKBA) have announced that the 8th annual Design & Construction Week® (DCW), featuring NAHB’s International Builders’ Show® (IBS) and NKBA’s Kitchen & Bath Industry Show® (KBIS), will no longer be an on-site event. Instead, the two groups are planning a robust, all-virtual event. The new all-virtual DCW 2021 will take place Feb. 9-12.
Registration for the virtual DCW event is free for all NAHB and NKBA members. Learn more at BuilderShow.com.
Home price appreciation accelerated in August in major markets across the nation.
The S&P CoreLogic Case-Shiller U.S. National Home Price Index, reported by S&P Dow Jones Indices, rose at a seasonally adjusted annual growth rate of 12.1% in August, faster than an 8.9% increase in July. It marks the highest annual growth rate since April 2013.
On a year-over-year basis, the S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index posted a 5.7% annual gain in August, up from 4.8% in July. It is the fastest pace of home price appreciation since July 2018. This month’s acceleration strongly reflected recent activity in existing home sales and tight inventory. Existing home sales in August reached a 14-year high, while the inventory decreased to three-month supply.
S&P reported that home prices in August increased dramatically in most metro areas, with annual growth rates ranging from -2.9% to 29.7%. San Diego led the way with a 29.7% increase. Home prices in New York declined by 2.9% in August.
New Inclusionary Zoning Tool
Inclusionary zoning (IZ) is often adopted under the assumption that it is a simple, expedient method to address a community’s shortage of affordable housing. But IZ is not as effective as its proponents claim, and a growing body of evidence suggests that IZ often discourages development and raises the price of market-rate homes.
NAHB has created an empirical tool, the Inclusionary Zoning Calculator Tool, that enables the user to assess how IZ requirements impact development choices. The IZ Calculator Tool uses a sample developer’s pro forma as the template, and allows the end user to input and revise certain variables to show how different incentives and cost inputs may be used to create an economically feasible development.
Talk about Construction Careers
A chronic labor shortage is slowing the residential construction industry. That's why it is essential that housing industry professionals communicate the value of a career in the skilled trades.
What is the best way to start the conversation about a career in residential construction? Many NAHB members and home builders associations (HBAs) across the country have ramped up outreach efforts and have shared these key points about the benefits of working in residential construction:
The housing industry is hiring. A career in the building trades offers strong earnings potential. This career path is a solid alternative to college. And there are a variety of training programs available. It's a job where you can make a positive impact on people's lives.
Home Price Appreciation Accelerates in August
What Voters Are Saying about Housing this Election Season
Housing has long been a key economic driver. So in the wake of the coronavirus pandemic and at the culmination of the 2020 elections, housing is an especially critical topic.
NAHB recently surveyed more than 2,200 registered voters from across the country to learn more about how housing has been impacted by COVID-19 and how it could play a role in the upcoming elections. The survey confirmed that housing availability and affordability are growing concerns for many Americans, and that the pandemic has only compounded these issues.
Among the key findings, a larger portion of respondents feels that the Democratic party is more likely to address housing affordability than the Republican party. The results also show the large majority of respondents are in favor of an additional financial stimulus.
Some of the survey’s other questions specifically asked voters:
• How they have used their federal
• If they are more likely to make home
improvements, as working remotely
becomes more common; and
• Where they would prefer to buy their
next home, in the wake of COVID-19.
The results can be viewed on the NAHB Housing Portal, which also offers a wealth of additional information about the state of housing at the national, state and congressional district levels.
The Housing Portal is an easy-to-use resource for industry professionals as well as the general public. Visitors can also easily create downloadable reports to share with their colleagues, clients and legislative contacts.
Additional voter resources regarding NAHB-endorsed candidates and the association's get-out-the-vote efforts are available here.