WASHINGTON (MNI) - The pace of new single-family home sales reversed lower in June, falling by 8.1% to a 406,000 annual sales rate after surging 8.3% in May, the Census Bureau reported Thursday morning.
The median forecast of economists surveyed by MNI was for the pace of new home sales to decrease to a 475,000 annual rate from the 504,000 rate seen in May. However, May was revised down sharply to 442,000 and June fell short well short expectations.
While the pace of sales fell in June, the supply of new homes available for sale rose 3.1% to 197,000 - which drove up the months supply to 5.8 months, above the 5.3 month supply in May and closer to a 6.0 months supply which is considered ideal.
Sales in the Northeast led the tumble, falling by 20.0% followed by the South which saw sales dip 9.5% and the Midwest which saw a 8.2% decrease. Sales in the West fell 1.9%.
While the latest new home sales showed some pull back after a strong May report, it should be noted that other indicators are showing some pick up in the housing market and new home sales are typically volatile. The National Association of Realtors latest existing home sales report showed that sales of existing homes rose 2.6% to a 5.04 million annual rate in June and the National Association of Homebuilder index revealed that builder confidence is on the rise.
