MetroIntelligence Economic Update by P. DUFFY
New home sales rise 8.0 percent in December and 4.4 percent year-on-year
Sales of new single?family houses in December 2023 were at a seasonally adjusted annual rate of 664,000, up 8.0% from November and 4.4% year-on-year. An estimated 668,000 new homes were sold in 2023. This is 4.2% above the 2022 figure of 641,000. The median sales price of new houses sold in December 2023 was $413,200. The average sales price was $487,300. The seasonally?adjusted estimate of new houses for sale at the end of December was 453,000. This represents a supply of 8.2 months at the current sales rate.
January economic output index rises to highest rate in seven months
Businesses in the US signaled a stronger upturn in activity at the start of the year, as output growth quickened to the sharpest rate in seven months. The expansion was driven by service providers, as manufacturers continued to see a drop in production amid intensifying supply issues. Firms reported stronger new order growth for both goods and services, helping push business confidence for the year ahead to a 20-month high. On the price front, overall input costs rose at a slightly softer pace at the start of the year, while firms raised their selling prices at the slowest rate since May 2020. Companies increased their workforce numbers at a marginal pace as backlogs of work rose for the first time in ten months.
2024-2028 housing market predictions: A gradual thaw with added challenges
Over the next five years, although some trends accelerated by the COVID-19 pandemic will continue to influence real estate and land use, other factors will also gain in importance. Among those are an aging population, the rising costs of climate change, a more unstable world and the expansion of artificial intelligence into new corners of the economy. As a consequence, even if the housing market gradually unfreezes as mortgage rates slowly decline from 2023’s highs, the hottest housing markets in 2028 may look a bit different from early 2024.