New Home Sales Fall Less than Expected in November Due to Revisions

New home sales in the U.S. fell less than expected in November on the back of a downward revision to the previous month, the Commerce Department reported Tuesday. Meanwhile, the median sale price rose to $220,400.

New home sales fell to an annualized pace of 407k, a 2.9% decline from October, the report said. The previous month's reading of 433k sales was revised to 419k.

Economists were expecting a 4.2% fall to 415k. Inventories rose to a pace of 11.5 months, up from an 11.1-month supply in October.

The median sale price of new houses rose to $220,400, up from $214,600 in October. Annually, prices have fallen 11.5%.

Regionally, the report was mixed. In the West, the pace of sales rose from 91k in October to 101k in November, while sales in the Midwest fell to 56k from 67k. Sales in the South moved down to 210k from 226k in October. Meanwhile, the pace of sales rose in the Northeast to 40k from 38k in October.

Prior to the release, economists from Desjardins noted that after having shown signs of stabilizing for a few months, new home sales returned to their downtrend. "The credit crunch continues to undermine home sales; the data from housing starts and builder confidence do not indicate there will be any improvement," they wrote. "One of the only rays of hope comes from the drop in 15- and 30-year mortgage loans rates and an increase in mortgage loan applications in the last few weeks."

Released at the same time, U.S. existing home sales fell to an annualized pace of 4.49 million units in November, a whopping 8.6% decline over the month, following October's downwardly revised sales pace of 4.91 million units, according to the National Association of Realtors (NAR).

By Stephen Huebl and edited by Sarah Sussman
©CEP News Ltd. 2008