Ahead of the Bell: US new-home sales

FILE - In this Thursday, Dec. 3, 2015, file photo, a home under construction and for sale is shown in Roswell, Ga. On Tuesday, Aug. 23, 2016, the Commerce Department reports on sales of new homes in July. (AP Photo/John Bazemore, File)

WASHINGTON — The Commerce Department reports on July sales of new homes Tuesday at 10 a.m. Eastern.

SALES SLIP: Economists believe that new-home sales fell just over 2 percent last month to a seasonally adjusted annual rate of 580,000, according to a survey by the data firm FactSet. This would be a pullback from an annual sales rate of 592,000 in June, the highest level since February 2008.

VOLUME PICKS UP: Construction of single-family houses has picked up this year, a sign that builders see more buyers in the months ahead as mortgage rates have held near historic lows and unemployment hovers at a healthy 4.9 percent. Relatively few listings of existing homes on the market have steered more would be-be buyers into newly built houses. Still, sales of new homes still lag the historic pace of roughly 650,000 a year.

A government report released last week showed steady gains in construction for single-family houses. Ground breakings for houses have climbed 10.6 percent year-to-date. This marks a sharp reversal from prior years in the recovery from the Great Recession when a large share of the increase in residential construction came from apartments.

June's median sales price rose 6.1 percent from a year ago to $306,700. Just 4.9 months' supply of new homes is listed for sale, well below this historic average of six months.

Builders continue to be optimistic. The National Association of Home Builders/Wells Fargo builder sentiment index released Monday rose two points to 60 following a downwardly revised reading of 58 in July.

Readings above 50 indicate more builders view sales conditions as good rather than poor.

Low mortgage rates are feeding much of this confidence. Mortgage buyer Freddie Mac said the average 30-year fixed-rate mortgage fell to 3.43 percent last week from 3.98 percent a year ago.

Must Read

Trump's shrinking trade appeal evident in North...

Aug 22, 2016

North Carolina may be the state most pivotal to Donald Trump's White House bid, and the audience...

Farm safety top priority with farm tourism on the...

Aug 24, 2016

Connecticut officials are joining other states in educating local farmers about how to mitigate...

Asian shares waver in thin trading after Wall...

Aug 25, 2016

Shares wavered in thin but volatile trading in Asia on Thursday, following a bleak day on Wall...

WHY IT MATTERS: Trade

Aug 25, 2016

In this angry election year, many Americans are deeply skeptical about free trade, it not downright...

SEC: Former Monsanto exec to get $22.5M as...

Aug 30, 2016

A former Monsanto executive who tipped off regulators about the agribusiness' accounting practices...

Sign up now!

About Us

In The Headline sought to bring professionalism back into journalism, bringing you only the most exclusive and the most impactive news from all over the globe.

Contact us: sales[at]intheheadline.com