NEW YORK ( TheStreet) -- New- home sales rose by a higher-than-expected 2.1% in May.
New-home sales rose to a seasonally adjusted annual rate of 476,000 homes, according to the Census Bureau. The Bureau revised its estimate of new home sales for April to 466,000 from 454,000. Economists polled by Bloomberg expected the sale of new homes to rise to 460,000.
The report also included strong upward revisions for new home sales in February and March.
Year-over-year, new home sales are up 29%.The seasonally adjusted estimate of new homes for sale was 161,000 representing 4.1 months of supply at the current sales pace. Home prices, however, appear to have cooled a little in May. The median home sales price for new homes sold in May was $263,900, with the average sale price at $307,800. In April, the median home sale price was $272,600 and the average home sale price was $331,300. Construction of new homes ground to a halt in the aftermath of the 2008 subprime crisis. In recent months, it has begun to pick up once more, but builders are facing shortages in labor and rising material costs. Builders are therefore selling larger homes targeted at the higher end of the market to recover their margins. Of the homes sold in 2013, 32% sold in the $200,000 to $300,000 range, while 25% sold in the $300,000 to $400,000 range. Only 13% of the homes sold for less than $150,000, while 14% sold for between $150,000 and $200,000. -- Written by Shanthi Bharatwaj in New York. >Contact by Email. Follow @shavenk