New-home sales posted their biggest drop in more than a year, throwing a small hiccup into this housing sector's path to recovery. The Commerce Department reported that new-home sales fell 8.4 percent in June, it’s largest drop since February 2011.
Existing-home sales also posted a 5.4 percent drop in June, but most of the decline is attributed to fewer homes for sale, according to the National Association of REALTORS®.
New-home sales were pulled down in June mostly by a 60 percent drop in sales in the Northeast and an 8.6 percent decline in sales in the South. Meanwhile, new-home sales in the Midwest ticked up 14.6 percent in June and by 2.1 percent in the West, the Commerce Department reported.
Even though overall new-home sales were down nationally in June, sales are still faring better than last year, one of the worst years on record for the sector. New-home sales were up 15.1 percent in June year-over-year. And new-home construction in June reached its highest level since October 2008, as home builder confidence reached a five-year high.
Source: “New-Home Sales Take Biggest Drop in a Year,” Reuters News (July 25, 2012)
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