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Economy in Brief

U.S. New Home Sales Unexpectedly Decline in June
by Tom Moeller  July 26, 2021

• Sales fall for third straight month.

• Decline spreads across most regions.

• Median home prices fall sharply.

Weakness in the new home market continues to extend. Sales of new single-family homes declined 6.6% (-19.4% y/y) during June to 676,000 (SAAR) from 724,000 in May, revised from 769,000. It was the lowest level of sales since April 2020. April sales also were revised downward to 785,000 from 817,000 estimated last month. The Action Economics Forecast Survey expected 800,000 sales in June.

Sales in the Northeast declined 27.9% (-40.4% y/y) to 31,000 units after a 2.4% May increase to 43,000. It also was the lowest level of sales since April of last year. Also declining were sales in the South which were off 7.8% (-24.8% y/y) to 367,000, down for the third straight month. Sales in the West weakened 5.1% (-12.7% y/y) to 186,000 following two months of firm increase. Showing 5.7% improvement (7.0% y/y) to 92,000 were sales in the Midwest. Nevertheless, sales in the middle of the country were off 25.8% since January.

The median price of a new home declined 5.0% (+6.1% y/y) to $361,800, following a 0.7% May gain to a record $380,700. The average sales price of a new home fell 1.2% (+12.2% y/y) to $428,700, down from the record $437,000 in April. These prices are not seasonally adjusted.

The supply of new homes for sale rose to 6.3 months in June, up from a low of 3.5 months in September and October of last year, and the most since April 2020. The median number of months a new home stayed on the market was 3.5, following 4.4 months in May. The figure was down from the nine-year high of 5.1 months in March.

New home sales activity and prices are available in Haver's USECON database. The consensus expectation figure from Action Economics is available in the AS1REPNA database.

U.S. New Single-Family Home Sales (SAAR, 000s) Jun May Apr Jun Y/Y % 2020 2019 2018
Total 676 724 785 -19.4 828 683 614
  Northeast 31 43 42 -40.4 37 30 32
  Midwest 92 87 88 7.0 94 72 75
  South 367 398 472 -24.8 476 399 347
  West 186 196 183 -12.7 221 182 159
Median Price (NSA, $) 361,800 380,700 378,200 6.1 334,992 319,267 323,125
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