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Economy in Brief

U.S. New Home Sales Improve; Prices Decline
by Tom Moeller  June 25, 2012

The housing market is on the mend. New home sales jumped 7.6% in May to 369,000 following a 1.2% April decline. However, March sales were revised up. May sales beat consensus expectations for 346,000. A one-third rise (127.8% y/y) in sales in the Northeast to 41,000 led last month's improvement followed by the South's 12.7% (16.6% y/y) gain to 204,000. Sales in both the Midwest, off 10.6% (+2.4% y/y), and the West, off 3.5% (+10.8% y/y), fell.

The median price of a new single family home fell for the third straight month. The 0.6% m/m decline (+5.6% y/y) to $234,500, from a downwardly revised April, was to the lowest level since January. The average price fell 3.5% (+4.3% y/y) in May.

The length of time to sell a new home held m/m at 7.9 months in May. The inventory of unsold homes remained near the all time low at 145,000 units (-14.2% y/y). This is a 4.7-month supply at the current sales rate.

The data in this report are available in Haver's USECON database. The consensus expectation figure is from the Action Economics survey and is available in the AS1REPNA database.

U.S. New Home Sales May Apr Mar Y/Y % 2011 2010 2009
Total (SAAR, 000s) 369 343 347 19.8 307 321 374
Northeast 41 30 27 127.8 21 31 31
Midwest 42 47 42 2.4 45 45 54
South 204 181 201 16.6 169 173 202
West 82 85 77 10.8 72 74 87
Median Price (NSA, $) 234,500 236,000 239,500 5.6 224,317 221,242 214,500
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