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May started off sluggish, but new home net sales rebounded last week.

Our Weekly Traffic & Sales Watch reported less than 150 new home net sales (new sales minus cancellations) during the first week of May.  This was the lowest weekly total of 2022.  While it is rather odd to have such a low total at this time of year, it coincided with the latest mortgage rate increase so it is not a surprise in that sense.  The cancellation rate also jumped up to over 23%, the highest weekly value since May 2020.  Needless to say we were quite interested to see what the numbers would show this past week.     

The good news for builders is that net sales jumped back up to over 200 for the week ending May 15th and the cancellation rate dipped below 20%.  While this was a nice week-to-week change, the graph below shows that it is still substantially higher than the "norm" for 2022 (10-15% per week).  As buyers adjust to the new interest rate reality we may see a few weeks of relatively higher can-rates, but we expect sales totals to remain steady.


We have already reported seven new communities opening in May.  DR Horton debuted the Trails collection at their Willow Ranch project in West Henderson, consisting of 90 townhomes.  They also opened up the Bay and Manor collections at the Pebble Hills project in the southwest valley with 53 and 10 detached home sites respectively.  In the northwest, two communities featuring larger lots and homes came into the market, Homestead Ranch from Century Communities and Sierra from Pinnacle Homes.  In North Las Vegas, Richmond American opened another community featuring its successful "Seasons" product line of two-story detached homes known as "Kestrel Heights."  Lastly, Lennar's redevelopment of the former Black Mountain Golf & Country Club is in full swing, now with two product lines open, the latest of which is called "Ridgeview" and offers 84 detached homes starting just under $600,000.

For those that missed our Housing Outlook Webinar presented by SW Gas on Thursday April 14th, the full slide deck with 30+ pages of charts and graphs is available for purchase.