U.S. new-home sales reached a 14-year high in July as low mortgage rates and a suburban construction boom helped fuel 13.9% month-to-month growth.
In July the annualized rate of 901,000 was up from a revised 791,000 estimate. The latest figure is the highest since July 2006.
The median forecast of economists polled by Bloomberg was a sales rate of 790,000.
The median selling price rose 7.2% year over year to $330,000.
Record low borrowing costs have helped fuel the housing boom, as has an exodus from major cities as companies turn to remote working in order to socially distance their employees.
Home purchases jumped 58.8% in the Midwest, 13% in the South and 7.8% in the West. Meanwhile, home sales fell 23.1% in the Northeast.
The surge in homebuilding before the pandemic is also driving the growth in new-home sales, according to a report from real estate brokerage Redfin.
The supply of new-construction homes for sale fell 28.4% in July as sales of newly built homes rose 10.1% in the month, according to Redfin.
The firm says that the number of newly built homes on the market could grow. Residential construction projects in the U.S. rose 23.4% year over year in July while building permits jumped 9.4% to a seasonally adjusted annual rate of 1.495 million, surpassing pre-pandemic levels.
U.S. homebuilder stocks were largely lower in the face of the reports.
At last check Lennar (LEN) - Get Lennar Corporation Class A Report dropped 1.5%, PulteGroup (PHM) - Get PulteGroup, Inc. Report fell 1.4%, D.R. Horton (DHI) - Get D.R. Horton, Inc. Report gave up 1.5%, KB Home (KBH) - Get KB Home Report declined 2.2%, and Toll Brothers (TOL) - Get Toll Brothers, Inc. Report was off 1.6%. NVR (NVR) - Get NVR, Inc. Report gave back 2.3%.