USD New Home Sales Change


A measurement in percentage of the construction of new residences in the US. The figure provides a timely indication of housing market conditions counting home sales when initial housing contracts are signed. New Home Sales tends to have significant market impact upon release due to it generally triggering a sequence of consumption. Apart from the high expenditure of new homes, it is also highly probable that buyers are going to spend more money on furnishing and customizing their home. In consequence, housing market growth causes an increase in consumption, thus generating a greater demand for goods and services along with the employees that are able to provide them. The housing market is usually monitored by a number of reports which mark different construction stages as well as the home sale process. The first stage is tracked by the Building Permits which precede Housing Starts. This leads into Construction Spending, MBA Mortgage Applications and, lastly, New Home Sales and Existing Home Sales. New Home Sales are thought to control for some of the volatile nature of other data. For example, Building Permits and Housing Starts are considered indicators of business confidence and production as opposed to consumer spending. Additionally, while Existing Home Sales figures are an indication of consumer expenditures, they are lagging indicators with far less predictive value. New Home Sales numbers are confirmatory of trends in housing, while remaining predictive of consumer spending. The figure is also a reliable gauge of economic turning points as it is sensitive to consumer income. The purchase of a house is a major expenditure which is generally only done when consumers have sufficient savings or are optimistic about their earnings in the future. When economic conditions slow, New Home Sales are one of the first indications of whether change has occurred. In the same way, New Home Sales experience substantial growth if the economy has come out of recession and wages have begun rising.