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July 28, 2014

New-Home Prices Pick Up Strength

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New-Home Prices Pick Up Strength

Sales of new single-family homes posted the first annual gain in seven years as median prices continued to rise, the Commerce Department reports.

The median price of new homes increased to $248,900 last month, a 1.3 percent increase compared to November. The median price of new homes sold was up 9.6 percent in December compared to a year ago. 

Meanwhile, new home sales increased nearly 20 percent from 2011 to 2012, the Commerce Department reports. While the gains were large, sales last year were still the third worst on record (2010 and 2011 also marked record lows in sales). For all of 2012, 367,000 new homes were sold—about a third of the record number of sales reached in 2005. 

Just for December—the latest month available—new-home sales dropped 7.3 percent compared to the previous month to a 369,000-unit annual rate. But numbers are subject to substantial revisions, as in November where sales were revised much higher to a 398,000-unit rate—marking the highest pace in nearly three years. 

Source: “New-home Sales Post First Annual Gain in 7 Years,” Inman News (Jan. 25, 2013) and “New Home Sales Drop, But Prices Tick Higher,” Reuters (Jan. 26, 2013)

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