US: Home Sales are poised for better days – Wells Fargo

Data released on Wednesday, showed New Home Sales rose 7.9% in January, above expectations. Analysts at Wells Fargo, point out unseasonably mild weather and lower mortgage rates boosted sales.

Key Quotes: 

“This past January was the fifth warmest on record, and those mild temperatures allowed for more home buying than usual. Seasonally adjusted home sales jumped 7.9% in January, with the West and Midwest accounting for practically all the increase.”

“While sales may revert to more typical levels in February, new home sales appear set for better days. Mortgage rates have fallen further in recent weeks and purchase applications have risen.”

“Home sales are also less likely to be impacted by coronavirus fears in the near-term. Barring a sustained stock market sell-off, new home sales are expected to trend higher this year, reflecting strong job and income growth and more positive demographics.”