New home sales slide in May

New single-family home sales in May fell 5.9% to a seasonally adjusted annual rate of 769,000 from the revised April rate of 817,000, the U.S. Census Bureau and the U.S. Department of Housing and Urban Development reported today.

The latest report is 9.2% above the May 2020 estimate of 704,000.

According to the National Association of Home Builders (NAHB), residential demand continues to be supported by low interest rates along with a renewed consumer focus on the importance of housing. Additionally, solid demand remains in lower-density markets like the suburbs and exurbs.

The NAHB also notes that higher building costs, longer delivery times, and general unpredictability in the residential construction supply chain are having measurable impacts on new home prices.

A lack of available and affordable lots are also holding back home builders. 

The median sales price of new houses sold in May was $374,400, rising 2.5% from a median price of $364,300 in April. The average sales price increased 2.3% to $430,600 compared to an average of $420,900 in the previous month.

By region, sales jumped 33% in the Northeast but were flat in the Midwest. 

The West saw a 6.7% increase while sales in the South declined 14.5%.

The seasonally‐adjusted estimate of new houses for sale at the end of May was 330,000.  This represents a supply of 5.1 months at the current sales rate and a 3.8% decline from the supply in May 2020.

Click here to read the latest New Monthy Residential Sales report for May 2021.