New House Sales: Sharp Increase Puts Slowdown Fears Behind?

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New House Sales: Sharp Increase Puts Slowdown Fears Behind?
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Below are comments from RCLCO’s Gregg Logan on the New House Sales numbers that were just released.

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“The recovery in the new home market continues, as confirmed by the Census Bureau release of the May 2020 sales figures, showing an increase of almost 17% over April 2020 sales. Although new house sales declined substantially in March, by Mid-April, even before the States began tore-open, home builders and community developers were reporting an increase in new house sales. That trend has obviously continued in May and we expect continued strengthening in the housing market will be demonstrated when the July figures are released a month from now. (Sales of new single-family houses in May 2020 were at a seasonally adjusted annual rate of676,000, according to estimates released jointly today by the U.S. Census Bureau and the Department of Housing and Urban Development).

There has of course been some concern about what would happen when the impacts of the government “stimulus” winds down, but so far the numbers are looking good for the housing industry. Prior to the social and economic upheaval of the pandemic ,there was already a great need to update and improve the consumer experience around home buying, and those builders and developers who are already utilizing online and virtual technology to make such improvements have had a significant advantage during this period of social distancing. While many builders and developers were already using online and virtual technology to enhance their sales and marketing, those tools are still underutilized in the real estate space. Builders and developers who had previously made investments in technology have been rewarded with less impact on their traffic and sales during this health crisis, and the current crisis has forced other builders and developers still on the fence to revisit their strategies for adopting online and other technology-oriented tools.”


About the Author

Gregg Logan, Managing Director, Director of Community And Resort

Over the past 30 years Gregg has worked with leading real estate developers, land owners, investors, builders and public sector entities, helping them make the best development, investment and/or planning decisions for their real estate. Gregg’s advisory work has included market evaluations and strategies for residential, commercial, and mixed-use developments; town centers and suburban business districts; and economic development studies for cities, counties, and community improvement districts.

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Jacob Wolinsky is the founder of ValueWalk.com, a popular value investing and hedge fund focused investment website. Jacob worked as an equity analyst first at a micro-cap focused private equity firm, followed by a stint at a smid cap focused research shop. Jacob lives with his wife and four kids in Passaic NJ. - Email: jacob(at)valuewalk.com - Twitter username: JacobWolinsky - Full Disclosure: I do not purchase any equities anymore to avoid even the appearance of a conflict of interest and because at times I may receive grey areas of insider information. I have a few existing holdings from years ago, but I have sold off most of the equities and now only purchase mutual funds and some ETFs. I also own a few grams of Gold and Silver

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