ARLINGTON, Va.—The median sales price of new homes fell to $313,000 in May – the lowest level since April 2017 – as new-home sales rose 6.7% during the month.
NAFCU Research Assistant Yun Cohen attributed the "higher than expected" monthly sales to increased purchases in the South.
"However, prices remain elevated overall and will likely trend higher due to rising construction costs," Cohen said in a NAFCU Macro Data Flash report. "According to the National Association of Home Builders, rising lumber prices have added nearly $9,000 to the price of a new single-family home since January 2017. Rising mortgage rates, which reached a seven-year high in May, pose additional headwinds for affordability."
According to data released Monday by the Census Bureau, new-home sales rose to 689,000 annualized units in May, which represented a 14.1% increase from a year ago. April's sales were revised downward by 16,000.
Sales by Region
In May, sales in the South surged 17.9% and were unchanged in the Midwest. Sales declined in the Northeast (-10%) and West (-8.7%), Cohen said.
Based on current-month sales, there were 5.2 months of supply in May, down from 5.5 months in April. The number of unsold homes left on the market rose to 299,000 units, which represents a 10.3% increase from a year ago, Cohen said.
The median new home price, non-seasonally adjusted, fell from $318,500 in April to $313,000 in May. May's prices were 3.3% lower than a year ago, Cohen added.