New Homes Sales Rebounded in May, Led by the South, West

(CN) — Sales of new homes rebounded in May, led by strong sales gains in the South and West, the Commerce Department reported Friday.

The government says sales of new single-family homes rose 2.9 percent last month to a seasonally adjusted annual rate of 610,000.

That followed a 7.9 percent drop in sales in April which was the biggest monthly decline in eight months.

Marked sales gains in the West (13.3 percent) and the Southeast (6.2 percent) outpaced a big decline in sales in the Midwest (25.7 percent) and the Northeast (10.8 percent).

The decline in new home sales in the Midwest was the largest drop in that region in nearly three years.

The median price of a home sold last month rose to a record $345,800, up 16.8 percent from a year ago. Prices have been increasing as demand has outstripped supply, in part because of a shortage of available building lots.

Sales of previously owned homes also rose last month. The National Association of Realtors reported Thursday existing home sales, a much larger market than new homes, increased 1.1 percent in May to a seasonally adjusted annual sales rate of 5.62 million.

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