WASHINGTON (ICIS)--US sales of new single-family homes fell by 13.4% in July from June, the Commerce Department said on Friday, dropping to the lowest level since December last year.
In its monthly report, the department said that sales of new one-family homes last month were at a seasonally adjusted annual pace of 394,000, a decline of 13.4% from the downwardly revised June figure of 455,000.
The June pace of new home sales had originally been estimated at 497,000.
The July downturn in sales of new single-family homes wholly offset the 8.3% gain that had been reported for June, before that month’s estimate was cut back.
The July sales pace of 394,000 units also marks the first time in seven months that the monthly tally of new homes sold has dipped into the under-400,000 range.
In the first half of this year, sales of new one-family homes had held steady in or near the mid-400,000 territory.
The last time that new home sales limped into the under-400,000 range was in December 2012 when the figure was 396,000.
A housing industry economist has said that a monthly sales pace in the 300,000s indicates that the housing market is “just running at idle”.
The July downturn in new home sales was widespread across four main regions of the US, with sales down by 5.7% in the Northeast, off by nearly 13% in the Midwest, and down by 13.4% and 16.1% in the South and West respectively.
On the positive side, July’s sales of new single-family homes were 6.8% better than the same month of 2012. But in the West, last month’s sales were nearly 8% below July of last year.
Construction and sale of new single-family homes is the core segment of the US housing market.
That market 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, roofing materials and synthetic fibres.
The American Chemistry Council (ACC) estimates that each new home built represents some $15,000 (€11,250) in chemicals and derivatives used in the structure or in production of component materials, equipment and furnishings.
The sharp decline in new home sales in July comes amid worries that the already wobbly US housing recovery may be facing some demographic headwinds.
($1 = €0.75)
Paul Hodges studies key influences shaping the chemical industry in Chemicals and the Economy