WASHINGTON: New home sales jumped 5.7 per cent in September from the previous month to the highest rate in more than two years as the housing market resurgence continued to take hold, the Commerce Department said Wednesday.
New single-family homes sold last month at an annualized rate of 389,000, up 27.1 per cent from a year earlier. It was the best performance since April 2010, when the rate was 422,000. That figure was boosted by a tax credit for first-time homebuyers.
The September increase beat analysts’ expectations of an annualized rate of 385,000 and came as other recent data pointed to a housing rebound.
But the median sales price for new homes last month dropped about 3.2 per cent, to $242,400, from August’s revised figures. Still, September’s median price was up 11.7 per cent from a year earlier.
“All the housing data has taken a turn for the better,” said Steven Ricchiuto, chief economist for Mizuho Securities.
“Clearly mortgage rates at such a low level and what appears to be an increase in banks’ willingness to make loans has boosted activity off the lows,” he said. “The gains look large on a year-over-year basis, but that owes to the exceptionally low level of activity.”
Some regions of the country fared much better than others in September sales.New home sales were up 16.8 per cent from the previous month in the South and 16.7 per cent in the Northeast. But sales were down sharply in the Midwest 37.3 per cent. Sales in the Western US were up 3.9 per cent from August.
Despite the overall positive data, Ricchiuto cautioned that the housing turnaround could be another “false start” unless employment picks up.
Meanwhile, seventeen national and regional environmental groups are petitioning the US Environmental Protection Agency to require oil and gas companies for the first time to report chemical use to the federal Toxic Release Inventory.
The drilling industry has long used and released large volumes of toxic chemicals, and that has dramatically increased in the past decade with the rapid spread of hydraulic fracturing, the Environmental Integrity Project and 16 other groups said on a national teleconference on Wednesday.
The petition, if approved, would require information on drilling chemicals be made available to the public for the first time on the federal TRI database.
“The Toxic Release Inventory brings daylight to dark corners, by requiring companies to quantify and report their pollution to a public data base for everyone to see,” said Eric Schaeffer, executive director of the Environmental Integrity Project.
He added, “Why shouldn’t oil and gas companies be required to report these toxic releases under our right-to-know laws, like so many other industries already do?” The EPA estimates that drillers release 127,000 tons of hazardous air pollutants annually, second only to coal-burning power plants and more than other industries already reporting to TRI, Schaeffer said.
The TRI was enacted by Congress in 1986 after the Bhopal chemical disaster in India.
The federal program requires each industrial facility to report annually on its releases of more than 650 TRI-listed toxic chemicals to the air, land, water, landfills, treatment plants, recycling and other sites.
The drilling industry was largely exempted from TRI reporting requirements.
Other parties involved in the petition included Earthworks, Clean Water Action, Sierra Club, the Natural Resources Defense Council plus grass-roots groups in Pennsylvania, New York, Maryland, Colorado and Wyoming.
In Washington, sales of existing homes fell 1.7 per cent in September after a big increase the previous month, but the trends in the housing market remain positive, the National Association of Realtors said Friday.
The drop from August, which was in line with analysts’ expectations, was caused by a tighter supply that is helping push up prices and encourage more construction, the group said.
Sales decreased to a seasonally adjusted annual rate of 4.75 million in September, down from a revised pace of 4.83 million in August. But the rate of sales last month was up 11 per cent from a year earlier.
And the median sales price last month was up 11.3 per cent from last September, marking the seventh straight month of year-over-year increase, the Realtors group said. The last time there were that many consecutive months of year-over-year price increases was in late 2005 to early 2006, during the housing boom.
“Despite occasional month-to-month setbacks, we’re experiencing a genuine recovery,” said Lawrence Yun, chief economist for the group. “More people are attempting to buy homes than are able to qualify for mortgages, and recent price increases are not deterring buyer interest.