New Home Sales Match Two-Year High
Sales of new homes continued the positive trend that has defined most of 2012, increasing year-over-year by more than 25 percent.
New home sales surpassed expectations in July, gaining 3.6 percent over the previous month and matching a two-year high.
Sales reached a 372,000 annual pace (seasonally adjusted), according to an August 23 report from the Census Bureau, matching May's reading with the strongest figure since April 2010. The July figure is 25.3 percent above the same month's 2011 estimate of 297,000.
The annual pace was higher than the median estimate of a Bloomberg survey of economists, which predicted 365,000 units sold. The month-to-month increase would have been higher if June's figured had not also been upwardly revised, to 359,000 from the original estimate of 350,000.
The housing market, both for new and existing homes, has been a consistent source of upbeat news in 2012. Inventory levels indicate that demand is starting to increase even beyond the slow-and-steady pace that has marked the year thus far.
Inventories of new homes available for sale fell to 142,000 units in July, the lowest level recorded since the government started tracking the figure in 1963. This represents a 4.6-month supply, matching this year’s low in May and below the six-month supply that economists expect from a healthy economy. Analysts expect demand to continue to rise through 2013, turning the housing market into a positive contributor to the economy for the first time in years.