WASHINGTON - New home sales jumped 14.8% in April to a seasonally adjusted annual rate of 504,000, driving down inventories as new home prices declined, the Commerce Department reported today.
Following the pattern set by the April existing home sales report on Monday, new home sales surged in the final month of the homebuyers’ tax credit. Customers had to sign a contract by April 30 to be eligible for the tax credit and need to close the transaction by the end of June.
Economists expected 420,000 new home sales for the month, according to the median estimate from Thomson Reuters.
New home sales for March were revised to 439,000 and sales for February sales were revised to 338,000.
The jump in sales pushed the inventory of new homes for sale to near record lows. The 211,000 new homes for sale in April was the lowest since 1968. The 7.0% drop in inventory from March to April was a record monthly decline. The supply of new homes fell to 5.0 months, the lowest level since December 2005, from 6.2 months in March.
New home prices fell even as buying surged. The April median sales price fell by 9.7% from March, the largest decline on record. April’s median home price fell 9.5% from a year ago.
April existing home sales soared 7.6% to a seasonally adjusted 5.77 million, the National Association of Realtors reported on Monday.
The NAR’s chief economist said Monday that he does not expect home price increases this year.
