New home sales in the U.S. unexpectedly showed another steep drop in the month of June, according to a report released by the Commerce Department on Monday.
The report said new home sales tumbled by 6.6 percent to an annual rate of 676,000 in June after plunging by 7.8 percent to a revised rate of 724,000 in May.
The continued nosedive surprised economists, who had expected new home sales to jump by 4.0 percent to an annual rate of 800,000 from the 769,000 originally reported for the previous month.
With the unexpected decrease, new home sales slumped to their lowest annual rate since hitting 582,000 in April of last year.
The drop in new home sales in June was led by the Northeast, where new home sales plummeted by 27.9 percent during the month.
New home sales in the South and West also tumbled by 7.8 percent and 5.1 percent, respectively, while new home sales in the Midwest surged up by 5.7 percent.
The report also showed the median sales price of new houses sold in June was $361,800, down 5 percent from $380,700 in May but up 6.1 percent from $341,100 a year ago.
The estimate of new houses for sale at the end of June was 353,000, representing 6.3 months of supply at the current sales rate. The month of supply is up from 5.5 in May.
“Home prices fell from their record June levels but continue to constrain the pace of sales,” said Mahir Rasheed, U.S. Economist at Oxford Economics.
He added, “We see some modest upside for new home sales in the second half of 2021 if input costs decline and further ease the pressure on home prices.”
Last Thursday, the National Association of Realtors released a separate report showing existing home sales rebounded in the month of June following four straight monthly declines.
NAR said existing home sales jumped by 1.4 percent to an annual rate of 5.86 million in June after slumping by 1.2 percent to a revised rate of 5.78 million in May.
Economists had expected existing home sales to surge up by 1.7 percent to a rate of 5.90 million from the 5.80 million originally reported for the previous month.
With the monthly increase, existing home sales rebounded after falling to their lowest level in eleven months in May.
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