WASHINGTON (6/24/15)--Largely driven by a jump in the Northeast, U.S. new-home sales rose 2.2% in May, and climbed 19.5% higher on a year-over-year basis, according to Census Bureau numbers released Tuesday (Economy.com June 23).
The Northeast may have skewed the overall picture, however, as sales surged by 87.5% during the month.
Sales in the West climbed 13.1%, while they fell by 4.3% in the South and 5.7% in the Midwest.
“The new-home market has been tightening for the better part of a year,” said Andres Carbacho-Burgos, Moody’s analyst (Economy.com). “The inventory-to-sales ratio is now at 4.5 months of sales, which looks low relative to the years of recession and slow recovery. However, the market for new homes is not quite at a threshold needed for accelerating construction.”
The median sales price for new homes came in at $282,800 for the month, a 1% drop on an annual basis, while the average sales price rose 4.2% annually to $337,000.
Regarding home prices, the Federal Housing Finance Agency reported Tuesday that its monthly purchase-only house price index rose 0.3% in April, putting it 5.3% higher on a year-over-year basis.
Seven of nine census divisions reported gains in April, though all nine divisions reported annual increases for the month.
“The U.S. housing market is having a better spring after the winter doldrums,” said Thomas McCartin, Moody’s analyst (Economy.com). “Housing starts fell in May, but only slightly, and permits picked up. Even so, residential construction has yet to accelerate; it is only slightly higher than in the second half of last year.”