And welcome back based on a brand new Report that was just announced today Which is on April 23rd sales of brand New single family houses increase However inventory absolutely surged the Highest level since February of 2008 I Have a lot to share in today's video and Let's go ahead and begin according to The National Association of home Builders they say the following despite Higher interest rates last month new Home sales Rose in March Due to limited inventory of existing Houses so overall there's approximately 15 to 20% more houses for sale compared To one year ago depending on the source Uh but we're still way below uh preco Levels however the pace of new home Sales will be under pressure in April as Rates moved above 7% this month which is Expected to moderate sales and increase The uses of um Builder incentives in Order to drive home sales so for the Month of March which is this um report I'm going over in today's video the Average 30-year fix was at 6.82% that's an increase from February At 6.70% um so it's uh pretty crazy to see That they had or home billers had more Sales this March compared to February Even though rates increased just a Little bit however as the uh National Association of Home Builders is pointed
Out in April uh rates have been Increasing so so far this month the Average 30-year fix is at 6.93% which should limit sales of brand New houses in April so in any case let's Have a look at the aution report that Was just announce uh this morning on April 23rd this report covers the entire Month of March and I'll share how the Figures we're looking at in today's Video regarding sales and inventory and Also home prices how that compares to Years pass going back to the early 2000s So any case this is from the uh US Census Bureau which covers um sales and Houses for sale of brand new single Family houses so excluding multif family Um homes in today's video and by the way A friendly reminder a new home sale is Really acting more like a pending home Sale a measure of contracts being signed Between buyers and home builders or home Builders getting a POS From a home buyer and that could occur Prior to a permit being issu in other Words these sales could be sales of dirt Lots in which the Builder is going to Build a house in 6 to 12 months from now Or it could be sales of houses under Construction or sales of completed Houses as well so again more acting like A pening home sale this could be a sale That could be close home sale in about One year depending on when the contract
Is signed between the Builder and the Home home buyer all right so check this Out because this is pretty wild let's Talk about sales and then we'll talk About inventory and then home prices so Sales uh these numbers by the way are Seasonally adjusted and also annualized As well so for March we came at 6 193,000 brand new single family houses That sold again more like a pending home Sale that was more than the streets Forecast of 668,000 this is also much Higher compared to febr is reading at 637 a gain of 88.8% from February and a Gain of 8.3% from 12 months ago also at 693 Th000 this is the fastest sales Pace Since September last year all right Let's have a look at a chart looking at Sales over the past 5 years so the Levels we have right now is more or less On par with preco levels uh because back Then uh back in uh early 2020 and late 2019 there's approximately 700,000 each Month but at 693 th000 this March this Is still way below the peak that was set Back in August of 2020 when at that time There was just over 1 million home sales Going back to this support these stats Also vary quite a bit depending on the Region so the uh census bro looks at the Northeast the Midwest the South and the West so on month-to-month basis uh sales Absolutely skyrocketed up by nearly 28%
In the Northeast whereas the Midwest Only increased by 5.3% but all four Major regions uh posted a gain uh Different compared to a year ago though Because in Northeast they fell by 133% Whereas in Midwest surged by 23% and the West increased by nearly 19% all right That's home sales to talk about Inventory levels of brand new single Family houses so for March this is Seasonly adjusted but it's not Annualized so there's approximately 477,000 homes for sale again that could Be a dirt lot house under construction Or a completed um uh house so at 477,000 That's the highest levels going back to February of 2008 also an increase of 2.6% compared to February and a 10.2% Gain from 12 months ago let's take a Look at our good uncle Fred so 477,000 Uh surpassed the peak which was back in October of 2022 uh but right now we're way above um The amount of houses for sale compared To pre-co levels so for example back in Let's just look at March 2019 there was only 337,000 now there's A whopping 477,000 Also zooming out going back to uh the Early 1960s at 477,000 right now which is right there This the highest levels going back to February of 2008 which is right there so
Inventory increasing from 1 month ago And of course from 12 months ago but Again the highest levels going back to 28 so again inventory overall very very High regarding brand new houses let's Also take a look at the month supply as Well so for the month of March we're at 8.3 months this is less than uh the peak More or less back in July 2020 or I Should say the peak over the past 5 Years when at that time the month supply Was at 10.1 months also at 8.3 months Right now this is much higher compared To pre-co levels because uh in 2019 Through early 2020 the months of Supply Was around 5.5 months also looking at This chart from uh the US Census buau at 8.3 months for comparison sake the All-time record high was at 12.2 months Set back in January of 2009 and the Record low was 3.3 months that was set Back in August of 2021 so overall 8 at 8.3 months this is Still historically High because a more Normal range is in in the range of 4 to 6 months and not 8.3 months they also Provided the number of houses for sale By stage of construction not yet started In other words a dirt lot a house under Construction and also completed houses As well and again I've been tracking the Number of completed houses for sale for Quite some time and again this is a Friendly reminder this is a key
Indication regarding our Builders sell Their houses or is there some red flags Ahead and I'll touch on that here a Little bit so again for the month of March we're at 477,000 the highest level Since February of 2018 um the vast majority of houses for Sale are houses under construction 282,000 out of the 477,000 so the number Of houses for sale that are under Construction right now is also at least A 12mon high as well but again what I'm More focused on is this right here Houses that are completed in other words The Builder can sell it and the buyer Can move in right away once the house is Theirs so um the figures for March is at 89,000 which is much higher compared to 12 months ago at 70,000 that represents A 27% increase over the past 12 months On top of that at 89,000 this is nearly triple the amount Compared to the all-time record lows Those set back in 2021 When at that time there was around 32,000 completed houses for sale also by My uh dumb analysis or my dumb math uh At 89,000 this the highest levels going Back to March of 2010 don't take my word For it here's our good uncle Fred so the Highest levels we've had going back to March of 2010 where that time we had 990,000 Completed houses for sale now we have
89,000 this is also way higher compared To preco levels when we had around 75,000 but also the runup ever since the Lows back in 2021 as well as 2022 has Been quite remarkable nearly tripling Ever since February of 2022 additionally Something you guys should be aware of as Well is that uh we still have far um Fewer completed houses for sale compared To the peak which was set back in uh 2007 when at that time there's 194 4,000 Completed houses for sale now there's Only 89,000 all right let's change gears Here and talk about the meeting sold Price uh this March and how that Compares to Year's past so in March the Uh meting sold price based on contracts Being signed was at $43,750 In fact by my dumb math that's a Decrease of 2% compared to year ago However at 43,700 that is a 6mon high which is Pretty wild though because um in my Video I posted one month ago for February when uh prices decreased to $46,500 that was nearly a threeyear low So in a span of just two months here we Went from a three-year low to a Six-month High and I highlighted the um Sales figures here each and every uh Month uh that had uh big swings right so In when was this in uh June of 2023 we Went from around 418,000 to just under 436,000 then it increased to 440,000
Then decreased once again to 426 and you Can see the trends going like this so in My personal opinion the median sales Price is impacted by the mix in sales But also um frankly because there's not Um nearly as many houses that sell in New home construction compared to Existing houses so um not seasonally Adjusted and also not analiz there's Only 67,000 brand new single family houses That sold for the month of March when You're looking at the resell Market There's over 200,000 it's normally Around 300,000 existing houses that sell each And every month I should clarify there Is around 300 to 350,000 um existing houses that sell Each and every month uh where again uh For brand new home construction only 67,000 this March and again I mention This because the levels of home sales Because are still relatively low uh can Have wild fluctuations in home sold Prices each and every month in any case Let's have a look at our good uncle Fred So this March at nearly 431,000 it's still less than the peak Back in October of 2022 with that time we're at 497 th000 So this is a quite a bit different Compared to one month ago back in February because February this year
Compared to October of 2022 we were down By 19% now because prices increased this March we're only down by 133% from the Record highs of October last year also Check this out because back in March of 2019 we were only at $310,500 This means that home prices over the Past 5 years have increased a whopping 39% I was trying to figure out why home Prices overall increase compared to 1 Month ago and it's not due to a change In the mix of sales for example so for House sold for over 750,000 um this March that was 14% of All home sales one year ago we were at 11% but for all these price segments Here virtually unchanged very little Differences so the mix and sales more or Less some par with one year ago if we Were to see a big increase of the number Of houses that sold for over 750,000 for Example of course that would um likely Impact the overall meting s price in Other words it would inflate it or if we Saw a lot more um home sales in a more Affordable range that would decrease Potentially the overall home price as Well however when looking at these sales For each of these price segments not a Lot of changes compared to March of 2023 as well as February this year as Well in my personal opinion the reason
Why we're seeing an increase in home Prices overall for brand new home Construction is because a lot of Builders are still offering incentives To to home buyers um so for example you Know when rates increase to over 7% a Lot of home buyers decide not to buy Houses because rates and home prices Have increased greatly over the past Several years that makes housing Affordability very Unaffordable however what Builders can Do is they can offer Builder incentives Such as a free um you know biller Upgrades or they can offer a uh closing Cost Credit in other words giving you $10,000 to $155,000 as a closing cost Credit in Which your out of pocket expenses in Buying a brand new house decreases by That amount but on top of that they can Also offer a lower rate for your Mortgage so for example back um in uh This month I should say in April the Average 30-year fix for people with Great credit has been in the range of 7 To 7.5% however bilders can offer a rate Much less than that which entices more Home buyers to buy a brand new house Compared to an existing house so in my Personal opinion due to these um Upgrades that Builders are offering home Buyers that is impacting home prices
Overall for brand new home construction You can see us in the data as well from The National Association of home Builders for the month of March 24% of Builders reported cutting home prices That's down from 36% in December of 2023 and also at 24% right now that's The lowest share since July of 2023 so again home builders overall have Not been decreasing home prices Especially compared to uh December and On top of that they're offering more Incentives it says here the share of Builders offering some form of incentive In March was at 60% this has remained between 58 to 62% % since last September but I would love To hear from you guys what do you guys Think about today's video the highest Levels of houses for sale of brand new Home construction since February 2008 Yet prices increased compared to one Month ago and also home sales also Rose From February and also from March of 2023 uh in my personal opinion what will Really should be focusing on is the Level of completed houses for sale Because again that has nearly tripled From the all-time record lows that was Set back in 2021 and 2022 anyways I hope you guys appreciate Today's video a lot of research went Today making today's video U please like And subscribe and we'll see you on the
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