U.S. new-home sales dropped 8.1% in June compared to May, when transactions unexpectedly rose, as the median price of a new home sold during the month also fell, the U.S. Census Bureau and the U.S. Department of Housing and Urban Development reported.
Specifically, 590,000 new homes were sold in June, compared to 642,000 in May. The pace of newly built home sales in June was down 17.4% from the 714,000 homes sold a year before.
The median price of a new home sold in June was $402,400, down from $444,500 in May but up from $374,700 in June 2021.
During the same period, the inventory of new homes for sale rose 10.7% month over month from 8.4 months to 9.3 months. Year over year, inventory was up 60.3% from 5.8 months.
“New home sales declined in June, as rising prices combined with rising interest rates decreased affordability even further,” RCLCO Real Estate Consulting principal Kelly Mangold said. “However, with the additional planned rate hikes later this year and persistent inflation, many buyers are still trying to close on a home before rates increase further.”
By region, the number of new-construction homes sold was mixed, with month-over-month decreases of 36.7%, 5.3% and 2% in the West, Northeast and South, respectively, and a 42.3% surge in the Midwest.
“The current for-sale market is somewhat less competitive than it has been over the past two years, and motivated buyers are now finding success is easier to come by, though increasingly costly,” Mangold added.