New Home Sales Drop in June, Inventories Hit Record High
{{#rendered}} {{/rendered}}Sales of new homes fell in June by the largest amount in four months while the inventory of unsold homes climbed to a record high, providing further evidence that the once-booming housing sector is slowing.
The Commerce Department reported Thursday that new home sales dropped by 3 percent last month to a seasonally adjusted annual sales pace of 1.131 million units. It marked the first drop since an 11.5 percent plunge in February.
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Sales of both new and existing homes set records for five consecutive years as the housing industry enjoyed a boom powered by the lowest mortgage ratesin four decades. But rates have been steadily rising this year as the Federal Reservetightens credit conditions as a way to slow the economy and keep inflation under control. Analysts are looking for home sales to drop by around 10 percent this year.
The government reported that the median price of a new home was $321,300 in June, which was up by just 2.3 percent from a year ago and was down by 1.5 percent from May.
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