New Home Sales Pop

New Home Sales were much stronger than market expectations and consensus forecasts.

February sales jumped to an 11-month high as new home sales hit 667,000 units on an annualized pace, this was 4.9% higher than January’s pace and 0.6% from this time a  year ago.

At the current sales rate, it would take 6.1 months to exhaust the available supply of homes. Over many decades, 6 months of supply has been the amount that’s generally considered a sign of a market evenly balanced between supply and demand.  Inventory dropped 0.6 percent from revised January figures to 340,000, and rose 13.3 percent from a year earlier.

The median price of a home sold during the month was $315,300, which is up 3.8% from January.  The Average Sales Price moved up to 379,000.

Lower mortgage rates, low employment and solid wage growth are all factors that are driving up sales for both Existing and New Homes.