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Kansas City, MO - Latest New Home Sales Numbers Suggest Market Decline is Deepening

Posted on: May 07, 2012 09:20:24 AM

In the Kansas City, MO market in January, new home sales declined year-over-year, and the percentage drop was steeper than December 2011, giving suggestion the market may be worsening. New home sales saw a fall of 36.9% from the year earlier to 82 after sales dropped 19.9% in December from the year earlier.

A total of 1,845 new homes were sold during the 12 months that ended in January, down from 1,893 for the year that ended in December.

Moving south from a year earlier, new home sales in January 2012 made up 3.3% of overall housing sales, while the year-ago figure was 4.7%. Following a year-over-year decline in December, sales of new and existing homes also declined year-over-year in January.

Pricing and Mortgage Trends

In January, the average price of newly sold homes rose to $309,184 per unit, a 5.0% rise year-over-year. This is an upward shift from the 6.8% decline in December from a year earlier.

Along with new home prices, there was an increase year-over-year in the average mortgage size on newly sold homes. It increased 4.4% in January from a year earlier to $257,228. In December 2011, average mortgage size slipped 6.2% from a year earlier. For newly sold homes, the percentage of sale price being financed moved from 83.7% of average price to 83.2% from a year earlier. It moved from 84.4% in December 2010 to 84.9% in December 2011.

Other Market Trends

Single-family homes accounted for a greater percentage of new home sales than last year. The share of new home sales belonging to single-family homes jumped from 94.6% in January 2011 to 96.3% of sales in January 2012. Conversely, the share of new home sales belonging to attached units slid to 3.7% of sales from 5.4% of sales.

For all new homes sold, the average unit size dropped 46.3% year-over-year to 1,200 square feet in January 2012. For newly sold homes, an average size decline contrasting with an average price rise was also seen in December 2011 when the average size of newly sold homes fell 34.3% to 1,653 square feet.

Foreclosures and real estate owned (REO) sales remained a drag on the market. Together, foreclosures plus REO sales made up 48.8% of existing home sales. They represented 53.5% in January 2011. The percentage of existing home sales involving foreclosures dipped to 21.9% in January from 28.9% a year earlier while REO sales as a percentage of existing home sales rose to 26.9% from 24.6%.

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