Sales of new single‐family houses surged in May, according to estimates released by the U.S. Census Bureau and the Department of Housing and Urban Development.
The seasonally adjusted annual rate came in at 763,000, or 12.2% above the revised April rate of 680,000 and 20% above the May 2022 estimate of 636,000.
“While this increase was stronger than our most recent forecast, it is not a surprise following last week’s reported surge in housing starts,” says Doug Duncan, chief economist at Fannie Mae. “The prior increases in active existing-home listings at the start of the year have since reversed over the spring home buying season, leaving few options for would-be purchasers.”
The median sales price of new homes sold last month was $416,300, while the average sales price was $487,300.
The seasonally adjusted estimate of new houses for sale was 428,000 at the end of May, representing a 6.7-month supply at the current sales rate.
“This report isn’t encouraging for home shoppers. Prices adjusted down last year as consumers pulled back from the market following the mortgage rate shock. Since then, however, dynamics in the housing market have shifted,” says Zonda chief economist Ali Wolf. “Demand is down, but supply is down even more. The net effect has been the return of rising home prices for the past few months. In fact, the Case-Shiller report showed that prices are now down just 2.4% compared to the peak last summer.”
