New Home Buyers Lead Sales Rebound
New home sales are a good indicator of what's currently happening in the housing market. This is due to the fact that they're counted when a contract to buy is signed, rather than at closing like existing-home sales. That's also why new numbers from the U.S. Census Bureau and the Department of Housing and Urban Development are good news for the market's recovery. According to the most recent results, sales of newly built single-family homes rose 16.6 percent in May from the month before and are now 12.7 percent higher than they were last year at the same time. The strength of the rebound was unexpected, as economists were predicting gains but thought sales would rise just 2.9 percent month-over-month. That the improvement was as strong as it was is an indication that home buyers – many of whom were sidelined by coronavirus shutdowns in March and April – became much more active in May. Along with other recent data showing signs of a rebound, May's new-home sales numbers are reason to be optimistic that the housing market's recovery will continue to gain strength as the summer goes on.