Macroeconomics

More "Middle-Class" Americans buy new houses in July 2013.


The estimated number of New Houses sold in July 2013 dropped from June for every region in the country.

However, estimated sales for July appear to be better than those for the same month of last year. Following data released this morning by the US Department of Housing and Urban Development and the US Census Bureau, the number of new houses sold in the United States dropped to 394,000 from June’s number of 455,000. Such drop represents a percent change of roughly -13.4% (90% Confidence Interval). The good news is that by the same month last year United States housing market had sold a slightly lower number of 369,000 units, which represents a 6.8% increase for this month in such sales (90% Confidence Interval).
 
Regionally speaking, the Southern region experienced the highest increase of July houses’ sales with a significant 16.4% change compared to the same month of 2012, as well as the North-East Region with a 10.0% change. On the other hand, the West experienced a drop of -7.8% in sales. The Mid-West data did not show a significant change from previous year.
 
In regards of prices, houses sold during July 2013 ranged between U$200,000 and U$299,999 in 32% of the cases; while 18% of the houses sold the same period were on a price range between U$150,000 and U$199,999. This former range climbed from a share of 18% for the same month last year onto a 25% share of sales for July 2013. Adding up the percentages may mean that half of the housing sales on July were around “Middle-Class” houses. Only 5% of the houses were sold at a higher price of U$750,000 and 6% higher than U$500,000.
 
Finally, it is worth noting that housing market may help to interpret aspects of the economic recovery, as well as potential spillovers on manufacturing sector and mortgages. Also, housing prices are relevant for inequality measures given that affordability (price elasticity) gets affected by prices at the higher bracket.

Categories: Macroeconomics

Leave a Reply