U.S. New Home Sales Fell for Second Straight Month in May
June 25 2019 - 10:30AM
Dow Jones News
By Eric Morath and Likhitha Butchireddygari
WASHINGTON--Americans purchased fewer new homes in May, a sign
the housing sector remains on uneven footing.
Purchases of newly built single-family homes decreased 7.8% to a
seasonally adjusted annual rate of 626,000 in May, the Commerce
Department said Tuesday. It was the slowest pace of sales since
December. Economists surveyed by The Wall Street Journal had
expected a sales pace of 683,000 homes in May.
The number of homes for sale in May would last 6.4 months at the
recent pace. That's up from 5.6 months a year earlier. The median
sales price of a new home in May was $308,000 down from $316,700
last year. But lower prices and more supply didn't stoke better
demand last month.
Sales data can be volatile and subject to revisions. The May
decrease came with a margin of error of plus or minus 14.7
percentage points. Sales in April were revised up modestly to a
679,000 pace, while March sales were revised down to 705,000.
New-home sales are a relatively narrow slice of all U.S. home
sales--about 90% of homes purchased in the U.S. were previously
owned. Sales of previously owned homes rose in May, increasing 2.5%
to a seasonally adjusted annual rate of 5.34 million, the National
Association of Realtors said last week.
The two markets moved in opposite directions last month.
Mounting concerns about the global economy have pushed down
borrowing costs, and that appears to be aiding the market for
previously owned homes. Mortgage rates are down more than a
percentage point from late last year, according to Freddie Mac.
That helps make properties more affordable for buyers who finance
their purchases.
Low unemployment and rising wages are putting more households in
a position to buy, somewhat insulating the broader real-estate
sector from a global slowdown.
Tuesday's report showed home sales fell sharply in the Northeast
and West, while rising in the Midwest and South.
A copy of the full report is available at:
http://www.census.gov/construction/nrs.
(END) Dow Jones Newswires
June 25, 2019 10:15 ET (14:15 GMT)
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