Washington – Sales of new homes bounced back in November and have posted increases in three of the past four months, a hopeful sign that this year’s severe drop in housing may finally be coming to an end.
The Commerce Department reported Wednesday that sales of new single-family homes rose 3.4 percent last month to a seasonally adjusted annual rate of 1.047 million units.
That was better than the 1.1 percent gain economists had been expecting, and the government also revised the previous three months to show stronger activity.
“It looks like sales activity has truly bottomed out,” said David Seiders, chief economist for the National Association of Home Builders.
Housing, which had been one of the economy’s best performers, has been battered this year as interest rates rose in the spring and potential buyers began to balk at paying prices that had surged to record levels, reflecting five boom years for sales.
The median price of a new home sold last month rose to $251,700, up 3.2 percent from the October level and 5.8 percent higher than a year earlier.
However, analysts said the price increase resulted primarily from the fact that sales increased in high-priced regions of the country such as the Northeast and West while falling in the South, where home prices are generally lower.
They predicted further price declines in the months ahead because the inventory of unsold homes, despite recent declines, remains high. The median price, the midpoint for homes sold in a given month, peaked at a record $257,000 in April.
It would take 6.3 months to exhaust the current supply of homes at the November sales pace, down from 6.7 months in October and 7.2 months in July.
