Sales of new homes decline in June
Strong May results followed by June drop
New home sales declined in June after a strong showing the previous month, the National Association of Home Builders (NAHB) said in a recent report.
According to the NAHB, June sales of newly-built, single-family homes declined 8.4 percent month-over-month. New home sales now sit at a seasonally adjusted annual rate of 350,000 units based on June results.
One month earlier in May, new home sales increased 7.6 percent month-over-month, bringing the seasonally adjusted annual rate up to 369,000 units.
“The lower number of new-home sales in June represents an adjustment from a robust level of activity in May, yet overall results for the second quarter show we are still on track for continued improvement,” David Crowe, NAHB Chief Economist, said in a statement.
Crowe continued: “That said, the very tight inventory of new homes for sale at this time poses a challenge to builders, who’d like to have a larger selection for buyers to choose from but continue to confront issues with obtaining credit to build viable new projects.”
Regional results mixed
Two of the four major U.S. regions saw an increase in sales of newly-built homes in June. In the Midwest, new-home sales increased 14.6 percent on a monthly basis, while sales grew 2.1 percent in the West.
On the flip side, new-home sales in June dropped 60 percent in the Northeast and 8.6 percent in the South.
“While we would have liked to see a third consecutive month of new-home sales gains in June, the fact remains that the sales numbers are up on both a quarterly and yearly basis, while builders continue to report that they are seeing more serious buyers in the market for a newly constructed home with all of the latest updates,” Barry Rutenberg, chairman of the NAHB, said in a statement.
Total inventory of new homes for sale remained at a 4.9-month supply, the NAHB reported.