New Home Sales Expected to End 2013 on a Flat Note
New home sales are expected to be flat in December due to seasonal factors and severe weather, according to economists at Wells Fargo Securities.
They expect the Census Bureau report slated to be released Monday morning will show December new home sales to come in at a 463,000 seasonally adjusted annual rate, compared to a 464,000 rate in November.
The WFS economists remain optimistic about the outlook for housing and they are forecasting that new home sales will hit 520,000 in 2014, up 20% from last year.
WFS senior economist Anika Khan noted that builders remain optimistic. She noted, however, that builders are catering more to move-up buyers and building fewer homes priced below $150,000.
I am most concerned about first-time homebuyers, she said. Even when it comes to existing home sales, the percentage of first-time buyers is low.
She blames this on tight credit conditions. It continues to be very difficult for these folks to get into the housing market, Khan said.