Sales of new homes unexpectedly surged in May, a sign that a lack of supply of houses for sale has driven buyers to seek out newly constructed units, a bright spot for the housing market.
New home sales in May rose 12.2% last month to a seasonally adjusted annual rate of 763,000, according to a report Tuesday from the Census Bureau, far above the number expected by forecasters. The reading comes despite persistently high mortgage rates. Sales were 20% higher than in May 2022.
UNIVERSAL BASIC INCOME PAYMENTS: CASH GIVEAWAY PROGRAMS EXPAND DESPITE MIXED RESULTS
Mortgage rates are much higher now than they were a year ago because the Federal Reserve has been hiking rates consistently since March 2022. Mortgage rates to lock in the purchase of a new or existing home are now about double what they were right before the Fed started raising rates — making homes increasingly unaffordable.
The median sales price for a new home was $416,300 in May, a decrease from the month befo …