The sale of new US homes rebounded in April after plunging the previous month, offering cautious optimism this volatile segment of the housing market was in recovery mode following a harsh winter.
US new home increased 6.8 percent to a seasonally adjusted annual rate of 517,000 in April, up from a revised rate of 484,000 in March, the Commerce Department reported on Tuesday.
New home sales remained well below February’s seven-year high of 543,000.
Compared to year-ago levels, new home sales were up 26.1 percent.
On a regional level, sales surged 36.8 percent in the Midwest and were up 5.8 percent in the South. However, new home sales declined 5.6 percent in the Northeast and 2.3 percent in the West, official data showed.
The median sales price of a new home in April was $297,300 while the average sales price was $341,500. Inventory levels at the end of April were 205,000, representing a supply of 5.3 months.
Existing home sales, which represent the largest segment of the housing market, eased off 18-month highs in April, the National Association of Realtors reported last week. Existing home sales declined 3.3 percent to a seasonally adjusted annual rate of 5.04 million after surging 6.5 percent the previous month. The lag in sales was primarily due to upward pressure on house prices stemming from lagging supply.
However, NAR also said last week that pending home sales rose for a third consecutive month in March, a sign of firming demand. The forward-looking pending home sales index increased 1.1 percent to a seasonally adjusted 108.6 in March. The index was up 11.1 percent from year-ago levels.