New Home Sales Up 13% Over Last Year

New homes only account for about 10 percent of all home sales. But, despite the fact that they are a small share of overall housing market activity, they are a significant factor in the health of the market. That's because new home construction is an important part of keeping the supply of available homes at a healthy level. And, when new homes are selling, builders build more. That's why it's encouraging that the most recent numbers from the U.S. Census Bureau and the Department of Housing and Urban Development show that sales of newly built single-family homes are now 12.8 percent higher than they were at the same time last year. However, though there has been significant improvement over last year's numbers, July's totals came in below economists' expectations. Economists polled by Reuters had predicted a month-over-month improvement but estimates show an approximately 2 percent drop. Still, gradual gains in the new home market make it more likely that builders will continue to add to the stock of homes for sale, helping to moderate prices and offer buyers more choices. More here.