WASHINGTON – Americans bought fewer new homes in June after sales jumped to a two-year high in May. The steep decline suggests a weaker job market and slower growth could make the housing recovery uneven.
The Commerce Department said Wednesday that sales of new homes fell 8.4 percent last month from May to a seasonally adjusted annual rate of 350,000, the biggest drop since February 2011.
Nationwide, sales in May and April were revised much higher. June’s sales pace is 15.1 percent higher than the same month last year. But sales remain well below the 700,000 annual rate that economists equate with healthy markets.
Las Vegas-based SalesTraq reported 353 new home sales in June, down from 413 in the prior month and a 1.1 percent decrease from the same month last year.
While the new numbers show moderation, new home closings in the past three months appear to be signaling positive momentum, SalesTraq analyst Brian Gordon said. Total sales are up 25 percent on a year-over-year basis, he said.
As new home communities in Las Vegas have closed out in recent months and new ones have cropped up, sales volume has remained relatively tight at 1.6 closings per subdivision in June.
“By the midpoint of 2012, a shift in the Las Vegas housing market is under way,” Gordon said.
Builders are more confident and breaking ground on more homes. Mortgage rates are at record lows. And home prices nationwide have stabilized after losing a third of their value in six years. Sales of homes have risen, although the increases have been choppy.
Sales of previously occupied homes fell in June to their lowest level since October. But sales were up 4.5 percent from a year ago .
Low inventory is holding back sales. There were 144,000 new homes for sale in June, just above May’s 143,000, the lowest on records dating back to 1963. At the current pace, it would take 4.9 months to exhaust the June supply. A six-month supply is generally considered healthy by economists.
Reduced inventory is pushing up overall home prices, . The median price of a new home, however, fell 1.9 percent in June from May to $232,600.
In Las Vegas, the median price of a new home was $196,500 in June, compared with $197,945 in May, according to SalesTraq. New home asking prices have started to edge up for builders such as KB Home, Harmony Homes and Warmington.
Low inventories are also spurring more building. Builders broke ground last month on the most new homes and apartments in nearly four years. Permits for single-family homes rose to the highest level since March 2010.
Home builders in Las Vegas pulled 648 new home permits in June, 41.8 percent increase from the same month a year ago, SalesTraq reported.
Surveys show builders are more confident in the market, partly because they are seeing more interest from potential buyers. However, many people are having difficulty qualifying for home loans .
Review-Journal writer Hubble Smith contributed to this report.