New home sales increased 12.2% from April to May to a seasonally adjusted annual rate of 763,000—the highest level for new home sales since February 2022, according to the National Association of Home Builders. Year-over-year, new home sales were up 20%.
A lack of existing home inventory was credited for the new home sales surge.
“The lack of resale homes available for sale, at just a three months’ supply, is supporting demand for newly built homes,” NAHB Chief Economist Robert Dietz stated. “New home inventory was 31% of total inventory in May. Historically it is typically 10% to 15%.”
Regionally, month-over-month, new home sales jumped 17.6% in the Northeast, 17.4% in the West, 11.3% in the South and 4.1% in the Midwest.
The median new home sale price was $416,300, a 7.6% drop compared with May 2022.
