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Philadelphia, PA - Newest Figures for New Home Sales Suggest Market Fall is Subsiding

Posted on: Feb 06, 2012 09:35:13 AM

In the Philadelphia, PA market in October, new home sales slid year-over-year, but with a percentage drop less harsh than September 2011, there are hints the market may be stabilizing. Sales slid 37.7% from a year earlier to 213, compared with a 43.7% drop in September from the year earlier.

A total of 3,666 new homes were sold during the 12 months that ended in October, down from 3,795 for the year that ended in September.

New home sales accounted for 5.6% of overall housing sales. This is a decline 8.0% of sales a year earlier. Sales of new and existing homes dropped year-over-year in October after also falling in September year-over-year.

Pricing and Mortgage Trends

The average per-unit value of new homes fell year-over-year to $355,004 in October, a decline of 17.7% from a year earlier. This drop is larger than the 4.5% decline in September from a year earlier.

Average mortgage size on new homes saw a decline year-over-year in contrast to prices of new homes. It sank 17.0% in October from a year earlier, reaching $258,912. In September 2011, average mortgage size remained level from a year earlier at $273,684. On aveage, the percentage of new home sale price that was being financed went from 72.3% of average price to 72.9% from a year earlier. In September 2011, there was a 3.5 percentage point rise from the year earlier.

Other Market Trends

The share of new home sales made up by attached units has risen while the share belonging to single-family homes has fallen. Attached unit sales increased from 39.2% of all sales in October 2010 to 46.9% of sales in October 2011. Meanwhile, single-family home sales as a percentage of all new home sales slipped to 53.1% of sales from 60.8% of sales.

For all new homes sold, the average unit size slid 15.7% year-over-year to 2,189 square feet in October 2011. A fall was also seen in September 2011 when the average size of new homes sold fell 40.9% to 1,499 square feet.

Foreclosures and real estate owned (REO) sales did not look to be a burden on the market. Combined, foreclosures plus REO sales made up 21.0% of existing home sales. In October 2010, they accounted for 26.0%. The percentage of existing home sales involving foreclosures declined to 9.5% in October from 13.5% a year earlier while REO sales as a percentage of existing home sales fell to 11.4% from 12.4% a year earlier.

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