Sales of newly built, single-family homes rose 7.9 percent to a seasonally adjusted annual rate of 764,000 units in January, coming off an upward revision in December, according to newly released data by the U.S. Department of Housing and Urban Development and the U.S. Census Bureau. The monthly number is 18.6 percent higher than the January 2019 rate and the highest monthly sales pace since July 2007.

"The January sales pace matches what builders are saying in NAHB surveys - builder confidence is strong and low interest rates have fueled single-family housing demand at the start of 2020," said Dean Mon, chairman of the National Association of Home Builders (NAHB) and a home builder and developer from Shrewsbury, N.J.

"Warm weather in many parts of the U.S. meant an early start to the home buying season," said Jing Fu, NAHB director of forecasting and analysis. "Meanwhile, the months' supply has fallen to 5.1, indicating additional housing inventory is needed."

A new home sale occurs when a sales contract is signed or a deposit is accepted. The home can be in any stage of construction: not yet started, under construction or completed. In addition to adjusting for seasonal effects, the January reading of 764,000 units is the number of homes that would sell if this pace continued for the next 12 months.

Inventory fell to a 5.1 months' supply, with 324,000 new single-family homes for sale, 6.6 percent lower than January 2019. Of that total, just 76,000 are completed, ready to occupy. The median sales price was $348,200. The median price of a new home sale a year earlier was $305,400.

Regionally, new home sales are 30.3 percent higher in the Midwest, 23.5 percent higher in the West and 4.8 percent higher in the Northeast. Sales are down 4.4 percent in the South.

Follow the latest home trends on nahb.org.