New Home Sales in West Bounce Back, Carry National Numbers Higher

New home sales bounced back in June from two prior reports of very weak sales.  The U.S. Census Bureau and the Department of Housing and Urban Development said those sales were at a seasonally adjusted annual rate of 646,000 units, a 7.0 percent gain from the downwardly revised May rate of 604,000.  June sales were also higher on a year-over-year basis, up 4.5 percent from the June 2018 estimate of 618,000 units.

New sales had posted significant losses in both April and May, down 6.9 percent in the first instance and 7.8 percent in the second.  That decline was made larger by the revision to the original May estimate of 626,000 units.

We noted last month that Mays results were stronger on a national basis than the number made them appear as losses were concentrated in the West.  This month the opposite occurred as downturns in the Northeast and especially the Midwest were offset by a very strong showing in the West.

The month's results were comfortably within the forecasts of analysts polled by Econoday.  They were looking for sales within a range of 630,000 to 676,000 units.  The estimate, however, missed their consensus of 660,000 units.

On a non-adjusted basis there were 57,000 newly constructed homes sold during the month compared to 58,000 in May.  Thus far in 2019 354,000 homes have sold, a 2.2 percent increase from the 346,000 sold during the same period last year.

The median price of a home sold during the month was $310,400 and the average price was $368,600.  In June 2018 the comparative numbers were $310,500 and $370,100 respectively.

At the end of the reporting period there were an estimate 338,000 new homes for sale.  This is estimated at a 6.3-month supply, down from 6.7 months in May but higher than the 6.0-month supply a year earlier.  Completed but unsold homes have been on the market for a median of 3.4 months.

Sales in the Northeast were down 4.2 percent from May and 50.0 percent year-over-year.  In the Midwest there were decreases of 26.3 percent and 17.6 percent from the two earlier periods.

The South pulled out a slight gain of 0.3 percent from May and sales were higher by 9.5 percent from the prior June.  The West posted a monthly increase of 50.4 percent and sales were 19.4 percent higher on an annual basis.