US new home sales rise 3.6% in July, partly reversing June decline

23 August 2012 18:06  [Source: ICIS news]

WASHINGTON (ICIS)--US sales of new single-family homes rose by 3.6% in July, the Commerce Department said on Thursday, an advance that offsets in part the sharp 8.4% decline reported for June.

In its monthly data on home building, the department said that 372,000 new one-family homes were sold in July, on a seasonally adjusted annual basis, compared with the upwardly revised June pace of 359,000 units.

The June level of new home sales was originally estimated at 350,000.

The July improvement restores the new home construction pace back to the level seen in May when 372,000 units also were reported sold (seasonally adjusted and annualised).

In addition to being 3.6% ahead of June’s level, the sale of new single-family homes in July also marked a solid 25.3% improvement over the July 2011 pace when only 297,000 units were sold.

The housing market – especially construction of single-family homes – is a key downstream consumer sector for the chemicals industry, driving demand for a wide variety of chemicals, resins and derivative products such as plastic pipe, insulation, paints and coatings, adhesives and synthetic fibres, among many others.

The American Chemistry Council (ACC) estimates that each new home built represents some $15,000 (€12,000) worth of chemicals and derivatives used in the structure or in production of component materials.

While the July pace of new home sales was a welcome reversal of the June downturn, the improvement was not nationwide.

The department said that most of the July advance was attributed to a huge 76.5% gain in the US northeast region.

There was a solid 7.7% gain in the midwest, but both the south and the west regions saw declines, with the South off by 1.6% and the wWest declining by nearly 1%.

($1 = €0.80)

Paul Hodges studies key influences shaping the chemical industry in Chemicals and the Economy

By: Joe Kamalick
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