2023.12.2214:30:00UTC+00U.S. New Home Sales Unexpectedly Plunge To One-Year Low In November

New home sales in the U.S. unexpectedly saw a substantial decrease in the month of November, according to a report released by the Commerce Department on Friday.

The report said new home sales plummeted by 12.2 percent to an annual rate of 590,000 in November after tumbling by 4.0 percent to a revised rate of 672,000 in October.

The nosedive surprised economists, who had expected new home sales to climb 0.9 percent to an annual rate of 685,000 from the 679,000 originally reported for the previous month.

With the unexpected slump, new home sales dove to their lowest level since hitting an annual rate of 582,000 in November 2022.

The steep drop in new home sales largely reflected weakness in the South, where new home sales plunged by 20.9 percent to a rate of 337,000.

New home sales in the West also tumbled by 5.1 percent to a rate of 150,000, while new home sales in the Northeast jumped by 3.1 percent to a rate of 33,000 and new home sales in the Midwest soared by 25.0 percent to a rate of 70,000.

The Commerce Department also said the median sales price of new houses sold in November was $434,700, up 4.8 percent from $414,900 in October but down 6.0 percent from $462,300 a year ago.

The estimate of new houses for sale at the end of November was 451,000, which represents 9.2 months of supply at the current sales rate. The months of supply is up from 7.9 in October but down from 9.4 in November 2022.

On Wednesday, the National Association of Realtors released a separate report showing existing home sales unexpectedly rebounded in November after five consecutive monthly declines.

NAR said existing home sales climbed by 0.8 percent to an annual rate of 3.82 million in November after plunging by 4.1 percent to a rate of 3.79 million in October.

The increase surprised economists, who had expected existing home sales to dip by another 0.5 percent to an annual rate of 3.77 million.