Connect with us

Hi, what are you looking for?

The American GeniusThe American Genius

Housing News

New home sales surge to a five-year high

New home sales surged dramatically in June and saw the highest annual improvement since 1992 – welcome news for one of the hardest hit sectors of the economy.

construction spending

new home sales

New home sales hit five-year high

According to the U.S. Commerce Department, new home sales surged to a five-year high in June, despite increasing mortgage rates and decreasing mortgage application volume. After improving 1.3 percent in May, sales of single-family homes rose 8.3 percent in June, the highest level since May of 2008.

While June sales marks a welcome improvement compared even to May, the Commerce Department data reveals single-family home sales rose 38.1 percent compared to June of 2012 – the largest increase since January of 1992.

The inventory of new homes on the market in June rose to its highest level since August 2011, but remains tight, pushing prices upwards – the new median home price rose 7.4 percent compared to June 2012. At the end of June, the supply of new homes fell to 3.9 months, down from 4.2 percent in May, both indicating improving sales.

It should be noted that new home sales are a measure of contracts signed, not necessarily closed transactions, so this indicator suggests an even brighter future for the new home sector, one of the most hard hit sectors of housing.

Good news, but challenges remain

According to the National Association of Realtors (NAR), the volume of distressed sales slides, prices are improving more rapidly, and while sales slid for the month, they are up dramatically from this time last year.

Advertisement. Scroll to continue reading.

Freddie Mac data shows that the 30-year fixed mortgage rate increased 0.53 percentage point in June to 4.07 percent, representing its highest level since October of 2011.

NAR’s Chief Economist Dr. Lawrence Yun said earlier this month, “First-time buyers should be closer to 40 percent of the market, but they’re held back by the frictions of tight credit and very limited inventory in the lower price ranges in most of the U.S.”

This represents a remaining challenge to new home builders which are well known for attracting first time buyers.

Tara Steele is the News Director at The American Genius, covering entrepreneur, real estate, technology news and everything in between. If you'd like to reach Tara with a question, comment, press release or hot news tip, simply click the link below.

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *


American Genius
news neatly in your inbox

Subscribe to our mailing list for news sent straight to your email inbox.



Economic News

(BUSINESS NEWS) Ben Carson's initial appointment to HUD was controversial given his lack of experience in housing, but what is the pulse now?

Housing News

With aging housing in America, are first-time buyers better off buying new or existing homes? The average age of a home is rising, as...

Housing News

(Housing News) If you own a home or are thinking of buying, you should know the factors that give you an advantage with your...

Housing News

(Housing) Realtors are tasked with being up to date on endless information, and attending the annual REALTORS Conference and Expo is a fast way...


The American Genius is a strong news voice in the entrepreneur and tech world, offering meaningful, concise insight into emerging technologies, the digital economy, best practices, and a shifting business culture. We refuse to publish fluff, and our readers rely on us for inspiring action. Copyright © 2005-2022, The American Genius, LLC.