U.S. Sales of new single-family homes were down 3 percent in June to a seasonally adjusted annual rate of 1.131 million units, following a downward revision to the sales rate for May, according to figures released by the U.S. Commerce Department.
Year-to-date, actual new-home sales for the first half of the year were down 11.9 percent from the same period during last year's record year in new home sales.
"The slowdown reported, coupled with the downward revisions of the previous 2 months, indicates that we are well into the predicted cooling down process," said Michael Carliner, an economist at NAHB. "We expect this to continue as the impact of recent increases in interest rates is fully reflected in sales."
"NAHB's current forecast shows about a 12 percent decline in new-home sales for 2006 as a whole, however, any further monetary tightening by the Federal Reserve would have a more severe negative impact on sales," Carliner added.
Three of four regions across the country posted a decrease in pace of new homes sales in June. Sales declined 11.3 percent in the Northeast, 7.9 percent in the Midwest and 6 percent in the South. The sales rate in the West increased 8.2 percent for the month. All regions reported substantially lower sales on a year-to-date basis.
The inventory of new homes for sale rose to 566,000 units at the end of June, a 6.1 months' supply at the current sales pace. Almost all of the increase was for-sale units that were permitted but not yet started, which represented nearly 20 percent of the inventory level.
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