New Home Sales Reach A 6 Year High!

The Commerce Department reported an 18% increase from July to August (504,000) in new home sales and August 2014 sales of new homes were up 33% from August 2013! This is a nationwide statistic. That is the highest level reported since May 2008, and the biggest single month jump since 1992. The significance of such a statistic is far reaching considering the effect the housing market has on the overall economy. In particular, every new home built is credited with employing eight people. Additionally, this confirms the strength of consumer demand for new homes. According to the National Association of Realtors, sales of previously owned homes in August slid a bit after four straight months of increases. Previously owned homes are the bulk of the transfers—approximately 90%. Home sales on a broad stroke have been improving and in my professional opinion is a key driver lifting our economy from the Great Recession. Here in the Hamptons, a newly constructed home is always under great demand—the question is if one can afford these jewels. I always say the only thing that trumps the smell of a new car is the smell of a new home!