MetroIntelligence Economic Update by P. DUFFY
New home sales dip 3.5 percent in September, but up 32.1 percent year-on-year.
Sales of new single-family houses in September 2020 were at a seasonally adjusted annual rate of 959,000. Development. This is 3.5 percent below the revised August rate of 994,000, but is 32.1 percent
above the September 2019 estimate of 726,000. Months of supply rebounded to 3.6 months.
U.S. economy continues to expand in October, especially for service businesses
The IHS Markit Flash U.S. Composite PMI Output Index posted 55.5 at the start of the final quarter of 2020, up from 54.3 in September, and signalling the fastest increase in private sector business activity since February 2019. Service sector firms recorded a marked and accelerated rate of expansion in output.
Preference for new homes rose to 31 percent in 3Q20, up from 18 percent year-on-year
According to NAHB’s latest Housing Trends Report for the third quarter of 2020, the share of Americans who are considering the purchase of a home in the next 12 months was 13 percent in the third quarter of 2020, one percentage point higher than a year earlier. The share interested in a newly-built home rose to 31 percent in the third quarter of 2020, up from 18 percent a year earlier. The share indifferent between a new or existing home, on the other hand, declined from 41 percent to 32 percent.
National Activity Index suggests slower but above-average economic growth in September
Led by some further moderation in the growth of production- and employment-related indicators, the Chicago Fed National Activity Index (CFNAI) declined to +0.27 in September from +1.11 in August. Three of the four broad categories of indicators used to construct the index made positive contributions in September, but three of the four categories decreased from August.