New home sales up big; down 21% from June 2008

Sales of new homes in the United States posted their largest monthly gain in eight years in June, the government reported on Monday, a sign that the housing market is bottoming as buyers take advantage of lower prices.

The Commerce Department reported that new single-family home sales rose 11 percent in June, an increase that dwarfed economists’ expectations of a 3 percent increase. The pace of home sales rose to a seasonally adjusted rate of 384,000 a year, the highest level since November.

Despite the monthly increase, sales of new homes were still down 21 percent from June 2008, and the market is still swamped by a glut of for-sale houses and foreclosed properties.

“These are still really bad numbers,” an economist at IHS Global Insight, Patrick Newport, said. “The market just couldn’t have dropped much further.” As sales rose, median prices of new homes continued to fall, slipping to $206,200 from $232,100 in June a year ago.

SOURCE: NY TIMES