The Commerce Department reported Tuesday new home sales in the U.S. rose 3.5% last month for single-family units to an annualized rate of 592,000. The report shows single-family home sales reached their highest level in 8 1/2 years, or since February 2008.
Wall Street was expecting 560,000 units and May’s sales pace was revised up to 572,000 units from the previously reported 551,000 units.
Sales were up 25.4 percent from a year ago. Last month’s increase left new home sales in the second quarter well above their average for the first three months of the year.
Regionally, new single-family homes sales in the U.S. increased 10.4% in the Midwest and 10.9 percent in the West, which has seen a sharp increase in home prices amid tight inventories. However, sales declined 5.6% in the Northeast and 0.3% in the populous South.
Last month, the inventory of new homes on the market gained by 1.2% to 244,000 units. At June’s sales pace it would take 4.9 months to clear the supply of houses on the market, down from 5.1 months in May.
The median price for a new home increased 6.1% from a year ago to $306,700.