US: New Home Sales drop in December, but a solid 2020 is expected – Wells Fargo
Data released today showed that New Home Sales dropped in December 0.4%. Analysts at Wells Fargo point out the drop left sales well below expectations, which had risen following earlier upbeat reports on resales and regional sales.
Key Quotes:
“New home sales fell 0.4% in December to a 694,000-unit annual rate and sales for the prior month were revised from a 719,000-unit pace to a 697,000-unit pace. The slower sales pace is surprising only because so much of the recent housing data have been so strong.”
“December brought total 2019 sales to 681,000, exactly in-line with our forecast and a 10.3% increase compared to the 617,000 new homes sold in 2018. Revisions to the preliminary data will likely shift this total, but 2019 was certainly a strong year.”
“With mortgage rates low and builder optimism rising, we expect sales to be solid again in 2020. Inventories are low, however, which will exert upward pressure on prices.”
Author
Matías Salord
FXStreet
Matías started in financial markets in 2008, after graduating in Economics. He was trained in chart analysis and then became an educator. He also studied Journalism. He started writing analyses for specialized websites before joining FXStreet.
