New-home sales leveled off during the summer, according to newly revised government figures that show weaker purchases than originally reported, catching many forecasters off guard.
The Census Bureau reported Wednesday that new-home sales fell to a 368,000 seasonally adjusted annualized rate in October, down 0.3% from September. (The September sales rate was revised downward by 30,000 units.)
The consensus among forecasters was that sales would decline slightly in October to a 383,000 rate. One Wall Street firm expected new-home sales would hit a 410,000 seasonally adjusted annual rate in October.
The new report shows that sales have been in a narrow range between 366,000 and 369,000 units (annualized) from July through October.
Overall, new-home sales are up 17% from October 2011. The September report showed new purchases rising 27% from a year ago.
“This was a disappointing update,” said Patrick Newport, an economist at IHS Global Insight.
“It indicates that demand for single-family homes is only slowly picking up, not accelerating, as the data previously showed. It also indicated that builders may have jumped the gun a little by accelerating the pace of construction of single-family homes.”