Welcome back I have some big news to Share because the US Census buau just Announced brand new home sales and Inventory levels across the US they Reported that there's about a 16 and a Half year high regarding the number of New house of for sale Nationwide on top Of that sales decreased by double digits Compared to the previous month and Compared to one year ago I have a lot to Share in today's video let's go ahead And Dive Right In so here's that report From the US say bro just announced uh Today which is Wednesday June 26 uh this covers the month of May they Look at sales and also inventory levels And home prices of brand new houses uh This uh video by the way and of course This support is only looking at new Single family houses so excluding um Multif Family Properties and by the way Just like my previous videos um they Define a sale as a deposit taken or a Sales agreement sign so this is very Much a forward looking indicator of Closed home sales of brand new home Construction and these sales again could Be a dirt lot in which you visit a home Builder you place a deposit down on that Dirt lot and the home builder builds a House and the house is constructed in Approximately 6 to 12 months that is a Sale also a sale could be a house under Construction or a completed house as
Well so again this is really about um Contracts being signed not close home Sales okay let's first talk about sales Uh on a national level which is this Column right here these figures are in Thousands of units and also they are Seasonally adjusted as well making it Easy compare uh month-to-month changes So for May which is right here there was 69,000 brand new home sales again this Could be a dirt lot house under Construction or a completed house but at 69,000 the seasonly adjusted and also Analized rate that's the lowest rate We've had going back to November last Year also looking at the sales compared To April down 11.3% a giant decrease down by 16.5% year-over-year now every housing Market's different right look at these Uh four four major regions this is the Northeast the Midwest the South and also The West the Northeast what's going on There I mean look at that down 44% in One single month uh also down by the Same amount compared to one year ago as Well in contrast uh in the midwest uh Sales increased by 13.3% year-over-year that actually was The only uh region that reported gain on A year-year basis because in the South Uh sales decreased by 18% and we down by 21% in the west uh on a month-to-month Basis all regions reported decreases but
The smallest decline was actually in the West only down by 4.5% compared to 44% In the the Northeast now something I Found to be really interesting as well Is that 69,000 again this is down by double Digits compared to April but also down By double digits compared to one year Ago but also it's lower than the Forecast which was calling for uh 636,000 now we're only at 619 th000 this Is also way below the previous reading Which is back in April at nearly 700,000 Units sold so part of the reason in my Opinion due to this decline in Sal in May is due to this right here in May um The average 30-year fix rate according To Freddy Mack the average for entire Month of May again these are contracts Being signed right so the average rate Was at 7.06% that's actually the highest rates We've had going back to November last Year when at that time the rate was at 7.44% now again I've been talking about This for quite some time right um a lot Of home builders right now are offering All these incentives so home buyers but Despite that we saw a decrease in sales Last month and also compared to one year Ago so despite the the fact that home Builders are offering you know a well Below market rate for a third-year fix Let's just say for example the average
30-year fix is at 7% I know a lot of Home builders are still offering rates At 5.5 to 6% on top of that a lot of Builders in my area which again is a Greater Sacramento area they're offering A free closing cost credit uh in the in The range range of5 to $15,000 which basically means for you as A home buyer there's a lot of incentives And uh and you know benefits of buying a Brand new house but despite that sales Decrease um this may here's also a chart Looking at sales um this may compared to The past 10 years so right now we're at Uh 69,000 like I mentioned the lowest rates Or lowest sales pce we've had um since November last year but also at 69,000 This is way below pre uho levels U so For example in let's just look at January January actually was actually a Little bit lower but um ever since February 2019 through much of the Year sales were Actually much higher compared to the 69,000 we're seeing right now in Addition it's nearly half the pace we Had going back to October 2020 uh back then of course the average 30e fix was around 3% now it's at 7% um But so it makes sense that sales are Much less than but it just uh Mindboggling to see that the sales were Over 1 million in October of
2020 now we're less than 700,000 all Right going back to uh the US Census Foros report here let's look at um Houses for sale this is inventory levels In the United States that increased by 1.5% uh month to month compared to April But increased by 133% compared to one Year ago so right now there's 4 81,000 brand new single family houses For sale again a dirt lot a house under Construction or a completed unit as well So 481 th000 this is the highest levels Going back to January of 2008 look at this right there 481 th000 Higher than the previous Peak which was Back in October of 2022 481 th000 we haven't seen that high Of the number of houses for sale going Back to January AR 2008 when at that Time there was 487 th000 brand new Single family houses for sale what's Also very interesting as well is that The month supply is actually exploding Right now we have a 9.3 month supply a Normal range is in the range of 4 to 6 Months of Supply now we're at 9.3 months This implies that home buyers have an Advantage of home builders right now This is a giing race of 15% in one Single month and we're up by nearly 35% Compared to uh May of 2023 one year ago we're at 6.9 months Now again we're at 9.3 months also Looking at our good uncle Fred at 9.3
Months this actually the highest level You've had going back to October of 2022 when at that time we had a 9. 7 Month supply also looking at pre Pandemic levels uh it was more normal Let me just kind of zoom out a little Bit more than this it was more normal to See the month supply in the range of Five to uh 7.6 months but more uh likely In the range of you know 4.8 to Approximately 6 months um from uh June Of 2017 through the end of 2019 so to see We have an elevated a number of new Houses for sale is quite the Understatement a 9.3 month supply high And also at 481 th000 basically a 16 and 1 12 year high right now something I've Been talking about the channel for quite Some time as well is that one metric That I follow very very closely that Also you guys should be aware of as well Is a number of single family houses that Are completed but they are still for Sale this is a great indicator about the Healthiness of the new home construction Industry so for May there's 99,000 brand new single family houses Completed that are still for sale this Is way above pre-co levels when it was More normal to have around 75,000 to About 880,000 houses for sale this is Also approximately three times higher as Well um compared to the levels we had
Back in February of 2022 at 31,000 now it's at 99,000 zooming out going back to uh the Late or the early 1999s Uh we're at 999,000 this is the highest number of uh Houses for sale that are completed going Back to November of 2009 now the reason Why I follow this very very closely is That if Builders are building houses They have them for sale but they can't Sell them that's a recipe for disaster Because all the you know the uh the sunk Cost in building a house you think of The roof all the materials inside the House all the labor involved in that There's a lot of cost of building a House and if Builders build a houses but They're not able to sell them that is a Red flag to St the laes okay let's Change gears slightly here and talk About home prices this is the medium so Price based on contracts being signed For brand new houses that is flat Compared to the previous month right now We're at 41 17,400 one year ago we're at $21,200 so um home prices or I should Say the median Soul price has decreased By about 1% year-over-year also looking Over the past 5 years um home prices Have been relatively flat ever since Really April of 2023 and again keep in mind this is a
Time when home builders are offering all These incentives so it's pretty telling To see that sales have been relatively Flat for about a year now and with that Said please comment below with your Biggest takeaways from today's video my Biggest takeaway honestly is the fact That sales ttin in May uh you know down By double digits compared to um April But also were down greatly compared to Uh one year ago as well and we're seeing Inventory absolutely exploding right now 481 th000 hous for sale I me basically We haven't seen this level since 2008 And on top of that sales are also or I Should say um home prices are Rel Relatively flat as well um so um some Big changes happening right now Regarding the new home construction Industry here so with that said please Comment below your biggest Safeways Though also if you guys want a real Estate agent referral whether you want To buy a brand new house there's Probably some deals out there or an Existing house please email me at Jasonjason walter.com or check out my Website which is real estate teamind Er.com um with that said thank you so Much for joining me in today's video I Appreciate you and we'll see you on the Next video He [Music]
