New Home Sales for May Drops in the south

new homes, REAL ESTATE

Sales of new one-family houses in May 2009 were at a seasonally adjusted annual rate of 342,000, according to estimates released jointly today by the U.S. Census Bureau and the Department of Housing and Urban Development. This is 0.6 percent (±17.8%)* below the revised April rate of 344,000 and is 32.8 percent (±10.9%) below the May 2008 estimate of 509,000.

The median sales price of new houses sold in May 2009 was $221,600; the average sales price was $274,300. The seasonally adjusted estimate of new houses for sale at the end of May was 292,000. This represents a supply of 10.2 months at the current sales rate.

While most other parts of the country did show an increase of new home sales, in the south new residential home sales dropped 8.9% from April 2009 to May 2009. Year over year the south has contracted 35.9%. Both data points show the southern regions continue to show the largest declines in new home sale on a month to month and year over year basis. New home inventory is starting to contract as well, indicating a possible bottoming of the new home market or at least the free fall is slowing down. However the bottom process in new homes will be stifled by the huge inventory overhang of existing homes for sale.

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