Sales of New U.S. Homes Unexpectedly Fall From Two-Year High [View all]
Demand for new U.S. homes unexpectedly dropped in June from a two-year high, indicating the housing recovery will be uneven.
Purchases decreased to a 350,000 annual rate, down 8.4 percent from the prior month and the weakest since January, the Commerce Department reported today in Washington. The median estimate in a Bloomberg News survey of 74 economists was 372,000. The decline was led by a record 60 percent plunge in the Northeast.
A supply crunch and sluggish progress in the job market may be depressing home purchases even as prices and mortgage rates remain attractive. Federal Reserve Chairman Ben S. Bernanke is among those who say the housing market is showing a “modest” recovery as buyers still face obstacles.
“A dearth of construction has led to a very significant inventory shortage,” said Carl Riccadonna, a senior U.S. economist at Deutsche Bank Securities Inc. in New York, who forecast sales would drop to a 345,000 rate, the lowest in the Bloomberg survey. “If you want to buy a newly built home, good luck finding one.”