New Home Supplies Keep Shrinking, Prices Pressured Higher

Home builders are slowly reducing inventory. According to Census Bureau data, the number of new homes [slid 1 percent from May](http://www.census.gov/const/newressales.pdf "New Home Sales data "). On a seasonally-adjusted, annualized basis, home buyers bought 312,000 newly-built homes last month. It's the third straight month of falling sales and the headline data casts the Brentwood housing market in a negative light. Upon closer inspection, however, the numbers appear quite strong. First, sales are down marginally. Total units sold have dropped just 2 percent from the highs of the year. And, second, the number of newly-built homes for sale is down markedly from last year There are [22% fewer new homes for sale](http://www.census.gov/const/newressales.pdf "New Home Sales data") today as compared to June 2010 At today's sales pace, the complete new home inventory would be sold in 6.3 months -- the quickest sell-out window since the expiration of the 2010 federal home buyer tax credit. Builders are feeling better about their business, too. After falling to a 9-month low, homebuilder confidence rebounded this month, boosted by expectations for a strong fall season. For buyers across Tennessee , this could be seen as a market-shifting signal. When builder confidence rises, negotiating for upgrades and price reductions can be tougher; "good deals" get scarce. If you're a home buyer and are considering new construction, don't let the headlines fool you. Sales figures _are_ slipping, but that's because there are fewer homes are for sale nationwide. The inventory is shrinking and that can push home prices higher. With mortgage rates still low, today's market may be your best value of the year.