New Home Sales Hit Record High

WASHINGTON – Sales of new U.S. homes jumped 4.0 percent in June, exceeding expectations and striking a record high as median sales prices declined for the second month in a row, a government report showed on Wednesday.

The Commerce Department (search) said new single-family home sales rose to a seasonally adjusted annual rate of 1.374 million units from an upwardly revised 1.321 million unit rate in May. The June sales pace was 14 percent higher than a year ago. May sales were first reported at a 1.298 million unit rate.

Wall Street had expected June new home sales to rise to a 1.300 million unit pace.

Sales climbed 7.2 percent in the U.S. Northeast, 5.1 percent in the South, 2.8 percent in the West and 2.1 percent in the Midwest.

The supply of homes for sale at the end of June stood at a record 454,000, up 2.5 percent from May and 18.5 percent higher than a year ago, the report showed. At the current sales pace, the supply of homes represented 4 months' worth in June, the Commerce Department said.

The national median sales price of a new home fell 5.5 percent to $214,800 from $227,400 in May. The average sales price on a new home fell to $267,400 in June from $287,400 the previous month.

Home sales have remained robust for more than four years due to stubbornly low mortgage rates. Earlier this week, data showed sales of previously owned homes also hit a record pace in June, due in large part to low borrowing costs.

The average rate for a fixed 30-year mortgage fell to 5.58 percent in June from 5.72 percent in May, the National Association of Realtors said this week, citing Freddie Mac data.

While the U.S. housing sector has shown little sign of easing so far this year, the Mortgage Bankers Association (search) earlier on Wednesday said applications for U.S. home mortgages dropped 5.8 percent last week as refinancing activity plunged.