Sales of new homes unexpectedly sank 12.4% in July from the prior month, underscoring continued weakness in the housing market absent government stimulus.
The Commerce Department said Wednesday that sales of new, single-family houses in July were sold at a seasonally adjusted annual rate of 276,000 units. That is 32.4% below the July 2009 estimate.
The government report follows news Tuesday that sales of previously owned homes dove in July, falling 27.2% over the prior month and igniting fresh concerns over the economic recovery.
The new-home sales numbers -- registered when a consumer signs a purchase contract on a home, as opposed to existing sales numbers that are measured when a deal closes escrow -- give the most current snapshot of buyer interest in the market absent the popular $8,000 federal tax credit for shoppers.
Economists surveyed by Bloomberg News had expected some modest improvement after new-home sales plunged in May and then bounced back in June.
“The fallout from the first-time home-buyers credit continues, but in a perverse way, this is a good thing,” Dan Greenhaus, chief economic strategist for New York brokerage Miller Tabak + Co., wrote in a research note. “Investors are getting their first ‘organic’ look at the housing market in nearly one year."
The median sales price of new houses sold in July 2010 was $204,000 while the seasonally adjusted estimate of new-home inventory at the end of July was 210,000, representing a supply of 9.1 months worth of supply at the current pace.
-- Alejandro Lazo
Photo: A framer walks along roofing trusses while working on a home under construction in Fountain Valley. Credit: Mark Boster / Los Angeles Times