• January new home sales were up 4.3% from December and 19.3% from January 2020, to 923,000 (SAAR).
• The median sales price of new houses sold in January 2021 was $346,400.
• The seasonally-adjusted estimate of new houses available for sale at the end of January was 307,000, up 2.7% from December but down 5.5% from January 2020.

Sales of new homes began 2021 right where they left off in 2020, near their highest levels in more than a decade and widely exceeding already optimistic expectations. As an added bonus, already strong numbers from prior months were revised upward, further adding to the afterglow of what was an extraordinary 2020 — which saw the most new home sales since 2006. The factors that drove this rally – low mortgage rates, limited supply of available existing homes for sale and wave of young adults eager to enter the market – remain in place to begin 2021. This persistent demand and heightened competition should help keep prices on the rise and the pipeline of upcoming projects full. Despite challenges, including rising costs of lumber, land and labor, confidence among homebuilders remains near an all-time high, and builders are finding flexible ways to overcome obstacles. This flexibility includes waiting to begin building a home until a sale is secured and/or favorable supplier and contractor agreements can be worked out — in January, the share of homes sold before beginning construction was 30.8%, up notably from both December and January 2020. This is exactly the kind of tone builders wanted to set at the start of 2021, establishing a very strong early pace for new home activity to come.