New home sales increased 5.8% month-over-month in November to a seasonally adjusted annual rate of 640,000 units (consensus 600,000) from a downwardly revised 605,000 (from 632,000) in October. On a year-over-year basis, new home sales were down 15.3%.
The key takeaway from the report is that it reflects how the pullback in mortgage rates in November proved to be an inducement for prospective buyers; however, affordability pressures remain for lower-income buyers and that is holding back overall sales potential.
The final December University of Michigan Index of Consumer Sentiment checked in at 59.7 (onsensus 59.1) versus the preliminary reading of 59.1 and the final reading of 56.8 for November. In the same period a year ago, the index stood at 70.6.
The key takeaway from the report is that consumer sentiment improved as inflation pressures eased.