More serious buyers return to us market

Condos being built in Brooklyn, New York Photo: Michael Tapp

More serious buyers are returning to the US, according to homebuilders, as the country's housing market continues its recovery.

Sales of new, single-family homes rose 5.7 per cent to a seasonally adjusted annual rate of 552,000 units in August 2015, according to data from HUD and the US Census Bureau.

Regionally, the Northeast, South and West posted respective gains of 24.1 per cent, 7.4 per cent and 5.4 per cent. The Midwest registered a 9.1 per cent decline.

The figures mark an almost eight-year high, as the rate hit the fastest pace of sales since February 2008. It shows "the release of pent-up housing demand as the overall economy strengthens, consumer confidence grows and mortgage interest rates remain low", says NAHB Chief Economist David Crowe.

"We continue to hear from our members that more serious home buyers are returning to the market," says Tom Woods, Chairman of the National Association of Home Builders (NAHB) and a home builder from Blue Springs, Mo.

Builders are gradually adding inventory to meet future demand as they handle shortages of lots and labor, he notes. Indeed, the new data arrives just after the NAHB revealed that single-family housing starts fell 3 per cent in the US during August 2015.

The inventory of new homes for sale was 216,000 units in August. This is a 4.7-month supply at the current sales pace.

"The housing market should continue to move forward at a modest but more persistent pace throughout the rest of 2015," adds Crowe.