While existing-home sales have slid the past few months, national new home sales are seeing an unexpected spike.
According to new numbers out from the U.S. Census Bureau, 696,000 new homes sold in May across the country, representing a 10.7 percent month-over-month increase. New home sales had been down the previous four months in a row.
New home sales are down 10.6 percent in 2022 on a year-to-date basis.
“Though new home sales registered a solid increase in May, we expect sales to decline in June following the Fed’s action to significantly raise interest rates in an effort to cool the economy and ease inflation,” said Jerry Konter, chairman of the National Association of Home Builders. “High construction costs and rising mortgage rates are pricing many buyers out of the market. Only 10 percent of new homes were priced below $300,000 in May, compared to 23 percent a year ago.”
New single-family home inventory remained elevated at a 7.7 months’ supply, up 42.6 percent over last year, with 444,000 available for sale. However, only 8.3 percent of new home inventory is completed and ready to occupy.