US new-home sales climbed in June to more than 8-year high

WASHINGTON (AP) — Americans bought new homes in June at the fastest pace in more than eight years, a sign that a solid job market and low mortgage rates are bolstering the broader U.S. economy. The Commerce Department said Tuesday that new-home sales rose 3.5 percent last month to a seasonally adjusted rate of 592,000, the best level since February 2008.

Purchases of new homes have climbed 10.1 percent year-to-date, despite volatile sales on a monthly basis. Low mortgage rates and a healthy job market have lifted the real estate market, which continues to recover from the depths of the housing bust that began nearly a decade ago. Greater demand and tight inventories have led to rising prices, such that the potential to return to the historic sales rate of 650,000 new homes could be limited.

Builders say they're struggling to find both workers and land for additional construction. June's median sales price rose 6.1 percent from a year ago to $306,700. Just 4.9 months' supply of new homes is listed for sale, well below this historic average of six months. Sales surged in the West and Midwest by more than 10 percent in June, but declined in the Northeast and South. The market for new houses is roughly just a tenth of the size of the existing-home market, where sales are also rising even as the number of listings are shrinking on a yearly basis.

The National Association of Realtors said last week that sales of existing homes rose 1.1 percent in June to a seasonally adjusted annual rate of 5.57 million, the best performance since February 2007. But the number of listings has fallen 5.8 percent from a year ago to 2.12 million.