U.S. new-home sales at 10-month high in December

“The December sales report is a great end to a very strong year”, said Ed Brady, chairman of the National Association of Home Builders (NAHB) and home builder and developer from Bloomington, Ill.

Sales of new single family homes rose in December to a seasonally adjusted annual rate of 544,000, according to the U.S. Census Bureau and Department of Housing and Urban Development. For all of 2015, purchases of new properties climbed 14.6 percent to 501,000. Sustained hiring and income growth would provide further impetus for the market, encouraging more construction and contributing to the economy.

Overall, anticipation of these hikes – in conjunction with the persistently sluggish wage gains over the last few years and the stock volatility and economic softness that have weighed on Americans in the first month of the new year – could make 2016 a tough year for housing.

Metropolitan areas such as Denver, San Francisco, Dallas and Portland, Ore., reported sales that either matched or exceeded previous all-time highs.

The median new-home sales price has fallen 4.3 percent from a year ago to $288,900.

See Thursday’s Arkansas Democrat-Gazette for full details.

Economists had estimated that new home sales rose 2% at and annual rate of 500,000, according to Bloomberg. The three-month average of the Mortgage Bankers Association’s index that tracks those applications is the highest since 2010. The latter are calculated when a contract closes, typically a month or two later, and account for about 90 percent of the market. Sales surged also because of unseasonably warm weather.

The new-home sales report follows other recent data that indicate mixed progress for the industry. On WednesdayThe Commerce Department said sales of new homes soared across the country in December.

Indeed, additional moves by the Federal Reserve to lift interest rates could dent the housing market’s expansion going forward.

Fortunately, mortgage rates have remained at historically low levels.