Sales of newly built, single-family homes rose 11 percent in June to a seasonally adjusted annual rate of 384,000 units, according to the U.S. Commerce Department. Coming on the heels of an upwardly revised number for May, the gain marks a third consecutive month of improved sales activity. In addition, nationwide housing starts and permits posted substantial gains in June as homebuilders responded to improved market conditions and the impending expiration of the first-time buyer tax credit.
“The nation’s housing market may be in the process of turning the corner,” said Joe Robson, chairman of the National Association of Home Builders (NAHB).
“The big gain in home sales last month was reflected in three out of four regions and helped shrink the inventory of new homes for sale to its lowest level in years,” said David Crowe, NAHB chief economist. “Even so, the pace of home sales in June 2009 was still more than 21 percent off the pace of sales in the same month last year, so we still have quite a way to go.”
The number of newly built homes on the market declined for a 26th consecutive month in June, falling 4.1 percent to 281,000 units.
Meanwhile, Commerce reported a 3.6 percent gain in overall housing starts to a seasonally adjusted annual rate of 582,000 units and an 8.7 percent gain in permit issuance to 563,000 units.
Single-family housing starts rose for a fourth consecutive month in June, posting a 14.4 percent gain to a seasonally adjusted annual rate of 470,000 units, while single-family permits rose for a third consecutive month, posting a 5.9 percent gain to 430,000 units.
Meanwhile, the multifamily side of the market, which characteristically displays greater month-to-month volatility, posted a 25.8 percent decline in starts following an unsustainably large gain in the previous month, to 112,000 units. Multifamily permits rose 18.8 percent to 133,000 units from an abnormal low in May.
With headlines across the nation reporting the economy may be turning around, the Department of Commerce is verifying that claim with optimistic numbers in the housing industry.