May new single family home sales continued unexpectedly firm and rose 4.6% m/m to 1.234 million (SAAR). The rise was third consecutive monthly increase and followed a 5.9% April gain that was little revised. Consensus expectations had been for a slight decline in sales to 1.15M during May.

Despite these signs of strength, new home sales so far this year are down 10.3% from the 2005 average and May sales were 9.7% below the monthly peak last July.

Sales down South posted the third consecutive firm m/m increase with a 6.0% gain (8.4% y/y). Year to year, that's the only region of country where sales were up. During May, sales in the Northeast fell 7.9% (-36.3% y/y), sales in the Midwest rose 2.7% but were off 20.8% y/y while in the West sales rose 5.3% in May but were down 12.7% y/y.

The number of new homes for sale dipped 0.7% m/m in May but were up a sharp 23.6% y/y. The year to year breakdown by region is as follows: Northeast, 52.8%; West, 27.2%; South, 31.0%; Midwest, -2.8%.

The median sales price of a new single family home fell 4.3% m/m to $235,300 following a 3.9% rise during April that was very much upwardly revised.

Movin' On Up from the Federal Reserve Bank of St. Louis is available here.

Can Financial Innovation Help to Explain the Reduced Volatility of Economic Activity? from the Federal Reserve Board can be found here.