Economy Watch: New Home Sales See Uptick in April
- May 27, 2014
Sales of new single-family houses came in at an annualized rate of 433,000 units in April, according to the Census Bureau and HUD on Friday. That’s a 6.4 percent increase compared with March, but 4.2 percent below the April 2013 annualized rate of 452,000.
As of the end of April, the number of new houses for sale was 192,000 units, or a 5.3-month supply at the current sales rate. The bureau further noted that the median sales price of new houses in April was $275,800, with the average sales price at $320,100.
Most new houses being sold these days fall in the middle to high-middle range in terms of price. According to the report, roughly one-third of the new homes sold in April (34 percent) fetched between $200,000 and $300,000, while about one-quarter of new homes during the month (24 percent) sold for $300,000 to $400,000. Much cheaper and much more expensive new-home sales were far fewer (for example, sales for over $750,000 formed only 3 percent of all sales during April).
Bank failures at sluggish pace
The year is nearly half over, and so far only eight banks have failed nationwide, with the most recent—and eighth for the year—being Columbia Savings Bank of Cincinnati, according to the FDIC on Friday. As bank failures go, it was pretty small. As of Q1 2014, the Columbia Savings Bank had about $36.5 million in total assets and $29.5 million in total deposits. The FDIC estimates that the cost to the Deposit Insurance Fund of this particular failure will be $5.3 million.
Banks failures have nearly dried up as of 2014. During the worst years of the recession, a large number of banks—including some very large financial institutions —failed. In 2009, the total number was 140; in 2010, some 157 banks failed. By 2013, however, only 24 banks failed. By the end of May last year, 14 banks had gone under, so this year’s failure rate is even shower.
The size of the failures is also shrinking. Infamously, WaMu—with its $307 billion in assets—came to a crashing end in 2008, while plenty of other multibillion-dollar banks likewise failed in the years that followed. So far this year, the largest bank to fail (in terms of assets) has been the Bank of Union, headquartered in El Reno, Okla., with $331.4 million in assets.
Wall Street had an up day on Friday ahead of the Memorial Day weekend, with the Dow Jones Industrial Average gaining 63.19 points, or 0.38 percent. The S&P 500 was up 0.42 percent and the Nasdaq advanced 0.76 percent.