New home closings slid year-over-year in December in the Allentown, PA market, but the percentage drop was not as steep as November 2015, suggesting market improvement. There was a 9.8% decline in new home closings from a year earlier. This came after a 25.5% drop year-over-year in November.
A total of 614 new homes were sold during the 12 months that ended in December, down from 620 for the year that ended in November.
New home closings made up 6.5% of overall housing closings. A year ago, new home closings made up 6.4%. For new and existing homes, closings slid in December after also declining in November year-over-year.
Pricing and Mortgage Trends
Average price of newly sold homes had a 1.8% boost year-over-year to $348,577 per unit in December. This lift is smaller than the 9.7% surge in November year-over-year.
The average mortgage size on newly sold homes rose year-over-year along with the average price of new homes. In December 2015, average mortgage size climbed 4.9% from a year earlier to $283,563. In November 2015, average mortgage size gained 14.0% from a year earlier.
Other Market Trends
The percentage of new home closings belonging to single-family homes has risen from last year while the portion of new home closings belonging to attached units has dropped. Single-family home closings grew from 52.5% of new closings in December 2014 to 58.2% of closings in December 2015. Conversely, the share of new home closings belonging to attached units fell to 41.8% of closings from 47.5% of closings.
The average unit size of newly sold homes slid 46.8% year-over-year to 1,287 square feet in December 2015. For newly sold homes, an average size drop contrasting with an average price lift was also seen in November 2015 when the average size of newly sold homes declined 8.4% to 2,193 square feet. In November, the average size of new homes sold went from 2,393 square feet a year earlier to 2,193 square feet.
Foreclosures and real estate owned (REO) closings continued to rise in December from a year earlier and remained a drag on the market. Together, foreclosures plus REO closings represented 28.2% of existing home closings, up from 25.5% a year earlier. The percentage of existing home closings involving foreclosures went from 12.8% in December 2014 to 13.2% in December 2015 and REO closings as a percentage of existing home closings climbed to 15.0% from 12.7%.