WASHINGTON (AP) — Sales of new U.S. houses tumbled 5.3 percent in June and the median sales price also slipped, a possibly ominous sign for the U.S. housing market.
The Commerce Department said on Wednesday that newly built houses sold at a seasonally adjusted annual rate of 631,000 last month, less than May’s revised figure of 666,000. The decline follows solid growth in previous months. The number of new-home sales has risen by 6.9 percent so far this year, but builders are starting to wrestle with the rising cost of lumber. At the same time, mortgage rates are on the rise and wage growth has been meager, squeezing many would-be buyers.
“Weak June new-home sales add more evidence that the housing market is flattening, and may have peaked for this expansion,” said Robert Frick, a corporate economist for Navy Federal Credit Union.
Monthly home sales figures can be fluctuate, but the latest report follows on a string of setbacks for the real estate industry.
The National Association of Realtors said on Monday that sales of existing homes fell by 0.6 percent in June, showing the third consecutive monthly decline. A shortage of listings and rising prices have contributed to a dip of 2.2 percent in existing home sales this past year.
Last week, the Commerce Department said that the number of ground-breakings on new homes decreased by 12.3 percent in June to a seasonally adjusted annual rate of 1.17 million, showing the slowest pace of construction since September 2017.
Home prices have been climbing, yet the median sales price for new houses declined last month. The median sales price declined 4.2 percent from a year ago to $302,100, as the share of homes selling for between $200,000 and $299,000 shot up last month.
Regionally, there was a 36.8 percent gain in the number of new houses being old in the Northeast. There were declines in the South, Midwest and West. The Midwest recorded the biggest drop, with new home sales falling 13. 4 percent last month.