Although the sales of new and pending homes in July were disappointing for analysts, they don’t necessarily show a pattern of decline for the housing recovery overall. As the labor market expands with the overall economy, the demand for homes will increase with it. Builders are still showing low inventories, which points to a continued growth in housing starts, and all three areas of home building (single-family, multifamily, and improvements) actually increased in July. Despite this, it is true that the Census and U.S. Department of Housing and Urban Development (HUD) reported a 13.4% drop in new home sales to an annual rate of 394,000.
Read the full article here: Eye on the Economy: Home Sales Slip in July