US: Demand for new homes to remain elevated this year - Wells Fargo

US New home sales were down 9.3% in December. According to analysts from Wells Fargo, December’s 625,000-unit pace is still solid and points to solid momentum heading into 2018. 

Key Quotes: 

“The housing data this time of the year is often volatile, as the seasonal adjustment process normally makes huge corrections to the underlying data. November’s extraordinary surge made it difficult for a large gain in December, exaggerating the slip on the month.”

“The number of new homes sold in 2017 was 608,000, or 8.3 percent above 2016. This coming year should be even stronger. 

“Recent data point to an optimistic outlook for the new home sales market in 2018. Homebuilder confidence remains near a multidecade high, as an increasingly short supply of existing homes on the market increases buyer traffic for new homes. The strong job market and low interest rates support homeownership.”