New single-family home sales rose 5.2% from October to a seasonally adjusted annual rate of 592,000, the Commerce Department reported Friday. November’s rate was up 16.5% year over year.
November’s sales figures came in ahead of analyst expectations, with economists polled by MarketWatch calling for a rate of 585,000 sales.
The median sales price of new homes sold in November was $305,400, compared to $304,500 in October and $313,500 in September. The supply of new homes dipped slightly to 5.1 months at the current rate of sales from 5.2 months in October.
While November’s strong report shows new-home sales hitting their second-highest level since early 2008, MarketWatch reported, the effect is a further tightening in demand.
A report this week from Zillow noted that in the top 35 U.S. markets and nationally, housing inventory levels were 25% or more below highs posted since January 2010.
Supply is particularly challenged in the starter-homes category, as many builders are only beginning to eye the price-sensitive, debt-laden and often rent-broke group of young first-time buyers that is expected to purchase homes in greater numbers next year.
The number of homes targeting the typical first-time buyer was down 12.1% year over year in the fourth quarter, Trulia reported, the largest drop in three years.
The tight market has builders confident that there will be demand if and when headwinds including the ongoing labor shortage, low lot inventory and regulatory burdens ease.