The latest new-home sales data, released this morning by the U.S. Department of Commerce, offers both good and bad news, depending on where you look. Sales fell 8.4% in June, dropping to an annual rate of 350,000 units. The decline came thanks to a 60.0% plunge in activity in the Northeast.
At the same time, sales estimates for the three previous months were all revised up.
Despite the decline in activity, the report is hardly cause for alarm, says Patrick Newport, U.S. economist at IHS Global Insight. "One should never get too excited (or depressed) by the latest new-home sales figures because they are not estimated very well," Newport wrote in a note today discussing the numbers. "June’s estimate fails the statistical significance test (it almost always does)."
Newport pointed instead to the data’s three-month moving average, which indicates sales are inching up on a national level. "Regionally, three-month sales have picked up smartly since the start of the year in the West and Northeast … but are wavering in the Midwest and South."
The median price ticked down slightly, dropping 1.9% on a monthly basis to $232,600. While inventory ticked up by 1,000 units from its record low to 144,000, completed homes for sale fell to 41,000, the lowest number on record.
Claire Easley is a senior editor at Builder.