Sales of new homes rose more than expected in June, up 11% - the largest increase since November 2008. This is the third straight month of gains and another indication that the housing market may be rebounding.New home sales grew to a seasonally adjusted annual rate of 384,000 homes, above expectations of 355,000 homes. These reports are subject to revisions and errors and, according to the government, it can take up to 5 months to establish a new sales trend. But, many analysts are calling this a good sign.
On economist, Richard Moody of Forward Capital warned that home sales are still at “exceptionally low levels.” And, others caution that the housing market has a long way to go, especially in the face of rising unemployment.
Inventories of new homes fell 4.1% to 281,000 which represents a supply of 8.8 months. Sales rose in the Northeast (+29.2%), Midwest (+43.1%), and West (+22.6%) while falling in the South (-5.3%).
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