December New Home Sales Up 45% From NovemberJan 26, 2023 12:00AM ● By NSBIA Press Release
2022 Sales at Pre-Pandemic Level, North State BIA Reports. Image by Paul Brennan/Pixabay
SACRAMENTO REGION, CA (MPG) - New home sales rebounded in December around the greater Sacramento region, with 372 sales recorded in the eight-county area, a 45% increase from November, the North State Building Industry Association reported today. Excepting the past two pandemic years, that is the best December BIA homebuilders enjoyed since 2006 and the best month in 2022 since April.
The solid December figures pushed the year’s total sales to 5,010, in line with the yearly totals recorded between 2015 and 2019.
Michael Strech, the BIA’s President, and CEO said the yearly totals show that the demand for new homes in the region remains strong.
“It’s clear that if we look at the year as a whole and not just the slowdown in mid-summer caused by the steep interest rate increases, sales continue to move towards levels we saw in the years before the pandemic generated the sharp increase in sales in 2020 and 2021,” Strech said.
“The demand for housing, particularly for new homes, remains as strong as ever in the region, so while we will see challenges in 2023, we believe the market will likely gradually improve as buyers continue to adjust to the new normal in mortgage rates.”
Highlights of the monthly and annual sales figures (excluding the additional 120 sales during the year) include:
Sacramento County sales broke Placer County’s six-month winning streak in December, but just by one sale, 169 to 168. Sacramento County sales narrowly outpaced sales in Placer County for the year as well.
Yuba County reported the third-highest sales totals in the region, outpacing El Dorado County.
Because very few homes are still available in the $300,000-$350,000 range as those older communities are now nearly sold out, the monthly total was actually -3 in that price range as three previous sales were canceled.
Strech said the fact that most sales are in the $500,000 range and above shows the impact of higher government fees, a limited supply of land on which to build, and regulatory delays and barriers that make production of more-affordable homes extremely difficult.
“As our poll showed last fall, an overwhelming majority of Sacramento-area residents are deeply concerned that their children and grandchildren will not be able to afford to buy a home in our region,” Strech said. “It’s essential that state and local policymakers enact reforms to encourage new home construction to bring the market back into balance. Otherwise, the affordability crisis will only grow worse.”
The BIA’s sales figures cover Sacramento, Placer, El Dorado, Yolo, Yuba, Sutter, Amador, and Nevada counties.