New Home Sales at 2-year High

The total inventory of new homes available for sale at the end of May also fell to a 12-month low of 4.7 months. In January 2009, the supply of new homes for sale totaled 12.1 months, an all-time record. An inventory total of less than 6 months supply is normal.

New home sales have averaged 353,000 over the first 5 months of this year, up from under 300,000 in the previous 18 months. On a non-seasonally adjusted basis, 35,000 new homes were sold in May, up from just 28,000 a year ago.

The largest number of homes sold in May came in the $200,000-$299,000 price range, followed by homes in the $150,000-$199,000 price range.

Overall, what we’re seeing is a housing market that has bounced off a bottom and is recovering. The recovery creeps along, but it makes steady progress.

Paul Ausick