US new home sales edge higher, but miss expectation amid a sharp hike in prices

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US new home sales edge higher, but miss expectation amid a sharp hike in prices

On Thursday, the US Commerce Department had issued a statement saying that the sales of new US single-family house increased by 1.6 per cent in December amid a multi-year low mortgage rate, though US new home sales last month had slightly missed an analysts’ estimate of 1.9 per cent as high-flying home prices following a record decline in inventories last week appeared to have weighed on buyers’ sentiment.

In point of fact, latest Commerce Department data on US new home sales came forth a day after the US Federal Reserve had pledged to keep its benchmark borrowing cost near-zero at least until a significant scale of recovery, while would likely to ramp up housing prices further in context of a bottlenecked supply chain, suggested analysts.

Nonetheless, according to US Commerce Department data on new home sales released earlier in the day, US single-family new home sales rose by a modest 1.6 per cent to a seasonally adjusted 842,000 units in December, while November sales were revised downward to 829,000 units from a previously reported reading of 841,000 units.

US new home sales jump 15.2 per cent on an annualized basis

Aside from that, US Commerce Department data had also added that new home sales surged to a whopping 15.2 per cent in 2020 on a year-on-year basis, while overall annual sales totalled to 811,000 in 2020, marking up an upsurge of 18.9 per cent on an annualized basis.

In tandem, despite an 8 per cent rise in home prices in December to a median of $355,900 on a year-on-year basis, new home sales soared robustly in the Midwest and Western part of the United States amid a record-low mortgage rate, while the New York-based US mortgage buyer Freddie Mac said in a statement shortly after the announcement that its 30-year fixed home loan rates were hovering around 2.77 per cent.