New home sales are shaping up for their best year since 2007

Sales of new single-family homes in November rose 4.3 percent from October and 9.1 percent from Nov. 2014 to a seasonally adjusted annual rate of 490,000, according to a new report from the U.S. Census Bureau.

That is a year-to-date increase of 14.5 percent, and if sales can keep pace in December, it will mark the strongest year for new home sales since 2007.

New Construction in 2015

In addition to its sales numbers, the Census Bureau released a treasure trove of numbers on the nation’s new construction markets, including:

•New construction continues to grow more and more expensive. The median sales price of new houses sold in November was $305,000 (up 6.31 percent from October), while the average sales price was $374,900 (up 4.69 percent). That median price is the highest ever recorded, while only Oct. 2014 saw a higher average sales price.

•Such a jump in prices is not entirely surprising, given how substantially new construction has shifted to higher-priced homes. From Nov. 2010 to November of this year, for instance, sales of new homes priced $199,999 and less have fallen from 40 percent of the market to less than 12 percent, while homes priced between $400,000 and $499,999 have risen from 5 percent to 14.71 percent; additionally, new homes priced $500,000 and up have grown from 10 percent of the market to 14.71 percent.

•Even with new home sales’ strong year, the overall housing market remains significantly imbalanced, in terms of how existing sales and new construction sales comprise the market. In a normal housing market, there are six existing-home sales for every new home sale. Since 2008, though, low levels of new construction (and high levels of distressed sales) have pushed the existing share of the market to atypical heights, and for November, there were 10 existing sales for every new home sale. Housing will not be truly recovered until that existing:new ratio declines.