Economic Snapshot: New and existing home sales reach record levels

Both new and existing home sales rose this month at seven- and six-year highs, respectively.

New home sales

Sales of new single-family houses in May 2015 were at a seasonally adjusted annual rate of 546,000. This is 2.2 percent above the April rate of 534,000 and 19.5 percent above the May 2014 estimate of 457,000.

This is the highest level of new home sales since February 2008.

The median sales price of new houses sold in May 2015 was $282,800 and the average sales price was $337,000. The seasonally adjusted estimate of new houses for sale at the end of May was 206,000, which represents a supply of 4.5 months at the current sales rate.

New home sales spiked 87.5 percent in the Northeast, the largest increase since July 2012. Sales in the West jumped 13.1 percent. Sales fell in the South and Midwest, down 4.3 percent and 5.7 percent, respectively. 

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Existing home sales

Total existing home sales rose 5.1 percent from an upwardly revised 5.09 million in April to a seasonally adjusted annual rate of 5.35 million in May. Sales have now increased year-over-year for eight consecutive months and are 9.2 percent above the previous year.

Existing home sales are now at their highest level in nearly six years.

Total housing inventory increased 3.2 percent to 2.29 million existing homes available for sale at the end of May. Housing inventory is now 1.8 percent higher than a year ago. Unsold inventory is at a supply of 5.1 months at the current sales pace, down from 5.2 in April.

The median existing home price for all housing types in May was $228,7000, 7.9 percent above May 2014. This marks the 39th consecutive month of YOY price gains.

The percent share of first-time buyers rose to 32 percent in May, up from 30 percent in April and is now at the same share it was at its highest level in September 2012. In May 2014, first-time homebuyers represented 27 percent of all buyers.

Distressed sales remained at 10 percent for the third consecutive month in May and are below the 11 percent share from May 2014. Seven percent of May sales were foreclosures and three percent were short sales.

GDP 

Real gross domestic product decreased at an annual rate of 0.2 percent in the first quarter of 2015, according to the third estimate released. In the fourth quarter, real GDP increased 2.2 percent.

The decrease in real GDP in the first quarter primarily reflected negative contributions from exports, nonresidential fixed investment and state and local government spending that were partly offset by positive contributions from PCE, private inventory investment and residential fixed investment. Imports, which are a subtraction in the calculation of GDP, increased.

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