US new home sales jump 4.3% in January amid severe drought in existing home supplies

Later this week, US Commerce Department said in a statement that US new single-family home sales soared as much as 4.3 per cent in January amid a severe decline in existing home supplies

by Sourav D
US new home sales jump 4.3% in January amid severe drought in existing home supplies

US Commerce Department said in a statement later this week that the sales of new single-family homes surged more than expected in January, mostly boosted up by a multi-year low mortgage rate alongside a chronic shortage in the supplies of existing homes, lighting up a beacon of hope that a robust US housing market would continue to support the economy amid a global-scale public health concern.

Alongside this, latest US Commerce Department report came against the backdrop of an NAR (National Association of Realtors) report that said at a current pace of sales, previously owned houses in the US market would more likely to dry up in just 1.09 months, eventually vindicating the latest upsurge in sales of new homes in the United States.

Apart from that, a blowout rise in the number of Americans who have been working and studying from home due to the pandemic-led restrictions had also feathered up the gains further in US new home sales market, as pandemic-wary Americans continued to avoid the densely populated US cities while taking shelters either in the suburbs or countryside.

Nonetheless, several sceptics were quoted saying that the recent leg of rally in US housing market would unlikely to persist in February amid a Texas winter storm that wreaked havocs in the US state alongside southwestern part of the country.

US new single-family home sales rise more than expected last month

According to US Commerce Department data revealed later this week, sales of single-family new homes surged 4.3 per cent to a seasonally adjusted 923,000 units amid a steep hike in prices last month on a year-on-year basis, while December sales of new homes were revised higher to 885,000.

Meanwhile, addressing to a salubrious US housing market which kept gaining momentum since later last year, a home and mortgage analyst at NerdWallet, Holden Lewis said, “There is an insatiable demand for homes right now, and it can’t be met by resales of existing homes, so people are signing contracts for new homes”.

Commerce Department