• November new home sales rose 5.2 percent from October and 16.5 percent from a year ago, to 592,000 units (SAAR) — the second-highest level reached in 2016, according to the U.S. Census Bureau.
• Inventory of new homes for sale also rose modestly, up 1.6 percent from October and 8.7 percent year-over-year.
• The median price of newly built homes sold in November was $305,400, down slightly from October.

New home sales rose modestly in November, a similar result to existing home sales and likely a sign that some sales may have been pushed forward a little bit by home buyers late in the buying process looking to lock in low mortgage interest rates in advance of looming increases. The rise in new home sales is a positive sign, but the modest bump essentially repeats the story we’ve heard all year long — small gains in new home sales, when what we really need to see are big leaps. That story needs to change, because the recent hike in interest rates and the promise of more to come in 2017 means next year’s housing market is already shaping up to be a lot different than 2016’s. Those rate hikes, while not particularly significant today, will begin to dent housing affordability next year and going forward, particularly when combined with home value appreciation that is already at high levels not seen in a decade. This rise in home values is primarily driven by one major factor: high demand, and limited supply. This didn’t get any better in November, when the inventory of homes for sale actually rose somewhat, but the months’ supply fell — as good an indicator of any of just how high demand for homes is from consumers boosted by a healthy job market and decent wage growth. Without more meaningful increases in new construction and sales of new homes much closer to the 1 million annual rate benchmark, inventory will remain incredibly tight and prices will continue to rise rapidly.