New Home Sales Start the Year Strong

New home sales picked up sharply in January, rising 15.9 percent over December’s rate to their highest level since before the crash.

Sales of newly built, single-family homes were at a seasonally adjusted annual rate of 437,000 in January, the Census Bureau reported today, their best monthly showing since July 2008. December’s sales figures were also revised upward to 378,000, up from 369,000 originally reported last month.

On an annual basis, January’s sales represent a 28.9 percent increase over the January 2012 figure of 339,000. The median price for a new single-family home was $226,400, up from $221,700 one year ago.

Home prices show improvement

Meanwhile, home prices ended the year on a strong note, with the S&P/Case Shiller index of home prices in 20 major U.S. housing markets rising 0.9 percent in December, it was reported today. For the year, the national composite index showed an increase of 7.3 percent.

“Housing and residential construction led the economy in the 2012 fourth quarter” said David Blitzer, chair of the index committee at S&P Dow Jones Indices. He noted that for the year, home prices rose in all but one of the 20 metropolitan areas covered by the S&P/Case Shiller survey.

The exception was New York City, where prices posted a 0.5 percent annual decline. The biggest annual price increase was posted by Phoenix, where prices rose 23.0 percent during 2012, while double-digit annual gains were also reported for San Francisco, Detroit, Las Vegas, Minneapolis, Miami and Los Angeles.

Overall, U.S. home prices are back to their fall 2003 levels, although there is significant variation among different housing markets around the nation.

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