New home sales surge to an 8-year high

New home sales rose 3.5% in June at a seasonally adjusted annual rate of 592,000, the best level since February 2008, according to the Census Bureau.

Economists had forecast that sales rose 1.6% at a seasonally adjusted annual rate of 560,000, according to Bloomberg.

“The share of all home sales composed of new homes ticked upward to 10.6% in June, as new home sales continue to slowly ease the crunch of low existing inventory,” said Trulia chief economist Ralph McLaughlin.

Sales fell less than expected in May, by 6% at an upwardly revised rate of 572,000.

Despite the drop, the pace of new home sales in April and May stepped up from the average pace in the first quarter, helped by low mortgage rates.

The median price of new houses sold in June was $306,700 while the average price was $358,200. The seasonally adjusted estimate of new houses for sale at the end of the month represented 4.9 months of supply at the current rate.

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