march 2015 new home sales (grant toch)
TRANSCRIPT
![Page 1: March 2015 New Home Sales (Grant Toch)](https://reader036.vdocuments.us/reader036/viewer/2022082607/55c4d8cdbb61eb6b0f8b4679/html5/thumbnails/1.jpg)
March 2015 New Home Sales
Conclusion
Looking at actual trailing 12 month year over year changes in new home starts, permits and sales, we see accelerating starts and sales but stagnating permits:
Permits: +2.6% Starts: +6.2% Sales: +8.0%
From a chart perspective, focusing on the post 2000 period (entire chart is below), the above dynamic looks like this:
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Single Family Starts vs Single Family Sales vs Single Family Permits, Actual Data, TTM (2000-Present)
Single Family Starts, Actual,TTM, Y/Y Single Family Sales, Actual, TTM, Y/Y
Single Family Permits, Actual, TTM, Y/Y
Looking at the specifics of the release, February 2015 new home sales (539k), annualized and seasonally adjusted, were the highest level since March 2008. Note that an increase in 1,000 actual homes in the Northeast, lead to a 20k increase (of the 107k seasonally adjusted increase) in the seasonally adjusted total for February 2015 versus February 2014.
February 2015 annualized and seasonally adjusted sales of 539k, however, significantly exceed the trailing 12 month sales of 450k.
From an actual sales perspective we remain at very low historic levels. Actual new home sales dynamics are as follows:
![Page 2: March 2015 New Home Sales (Grant Toch)](https://reader036.vdocuments.us/reader036/viewer/2022082607/55c4d8cdbb61eb6b0f8b4679/html5/thumbnails/2.jpg)
Actual February 2015 sales (44k) were 26% y/y greater than February 2014. Actual trailing twelve month sales (450k) were 4.9% greater than one year ago and marked the fastest year
over year acceleration since February 2014 versus February 2013.
Sales are increasingly driven by homes above the mean and median house price.
Supply on the market is 4.7 months, a level consistent with the previous 3 Februarys.
Analysis
1. Seasonally Adjusted Data
March 2015 new home sales, annualized and seasonally adjusted were reported at 481k units, down from 543k in February 2015 but higher than 403k in March 2014.
2. Actual New Home Sales
March 2015 actual new home sales were 45k, a 15% y/y increase from March 2014 levels. From a level perspective, March 2015 results are now above the lows seen in 1982:
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March New Home Sales, Non-Seasonally Adjusted (1963-Present)
March New Home Sales, Non-Seasonall Adjusted (1963-Present)
On a trailing 12 month basis, new home sales are improving and increased 8.0%:
![Page 3: March 2015 New Home Sales (Grant Toch)](https://reader036.vdocuments.us/reader036/viewer/2022082607/55c4d8cdbb61eb6b0f8b4679/html5/thumbnails/3.jpg)
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New Home Sales, 12 Month Moving Average, Y/Y
New Home Sales, 12 Month Moving Average, Y/Y
From a level perspective, trailing 12 month sales remain at very low levels:
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New Home Sales, Actual Sales, 12 Month Rolling Average
New Home Sales, Actual Sales, 12 Month Rolling Average
3. Price
![Page 4: March 2015 New Home Sales (Grant Toch)](https://reader036.vdocuments.us/reader036/viewer/2022082607/55c4d8cdbb61eb6b0f8b4679/html5/thumbnails/4.jpg)
From a price perspective, new home sales are increasing because of large increases in the sales of homes above and beyond both the median and average prices:
Mar-14 Feb-15 Mar-15Under $150k 5.1% 4.5% 2.3%$150-199K 17.9% 15.9% 15.9%$200-299K 30.8% 38.6% 36.4%$300-399K 23.1% 18.2% 20.5%$400-499K 10.3% 9.1% 11.4%$500-749K 7.7% 9.1% 9.1%$750K+ 5.1% 4.5% 4.5%Total 100% 100% 100%Median Price $282.3 $281.6 $277.4Average Price $331.5 $345.5 $343.3
% New Home Sales, By Price
4. Inventory
Supply on the market increased to 5.3 months:
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New Home Supply (Months)
New Home Supply, in Months (1963-Present) Historical Average
But the level of inventory, expressed in months, is consistent with the March’s of the recent past:
![Page 5: March 2015 New Home Sales (Grant Toch)](https://reader036.vdocuments.us/reader036/viewer/2022082607/55c4d8cdbb61eb6b0f8b4679/html5/thumbnails/5.jpg)
2008 2009 2010 2011 2012 2013 2014 201510.5 11 7.1 7.2 4.9 4.2 5.7 5.3
March New home Sales Inventory
5. Overall State of the New Home Sale Market
As you can see below, single family starts, (blue line), sales (red line) and permitting (green line):
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Single Family Starts vs Single Family Sales vs Single Family Permits, Actual Data, TTM (2000-Present)
Single Family Starts, Actual,TTM, Y/Y Single Family Sales, Actual, TTM, Y/Y
Single Family Permits, Actual, TTM, Y/Y
There is plenty of room remains for improvement in new home sales relative to the size of the US economy:
![Page 6: March 2015 New Home Sales (Grant Toch)](https://reader036.vdocuments.us/reader036/viewer/2022082607/55c4d8cdbb61eb6b0f8b4679/html5/thumbnails/6.jpg)
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New Home Sales Median Price * Volume/GDP, Nominal
New Home Sales Median Price * Volume/GDP Average (1968-Present) Average (1968-6/30/1997)