The available supply of foreclosures and short sales previously stunted the recovery for new home sales, according to CoreLogic’s May report. Though, now that the supply of distressed homes and existing-homes for sale has fallen, there’s more room for the new home sales market to expand.
According to CoreLogic, the number of seriously delinquent mortgages (90-plus delinquencies, including foreclosures and REOs), peaked at 3.7 million in January 2010, but has fallen by 1.2 million, or by 33 percent.
As delinquencies decline, new home sales are rebounding after hitting low points over recent years. Citing data from the Census Bureau, CoreLogic reported new home sales have increased 19 percent from a year ago in March.
Improvements in the new home sales market also benefits the economy in several ways since new homes require the acquisition and development of new land, the purchase of supplies, and the need for labor.
According to the report, every new home requires five full-time jobs for 12 months. (DSN)