The U.S. Census Bureau released data today on the annualized number of new single-family homes that were sold during the month of June. Sales of new U.S. homes unexpectedly fell for a second month showing the industry that sparked the recession is stagnating.
Sales dropped 1 percent in June to a 312,000 annual pace, a three-month low. Sales in May were revised down to a 315,000 pace from a previously estimated 319,000. Economists projected sales of new houses in June would climb to a 320,000 annual rate.
An expanding inventory of foreclosed homes and a lack of demand will probably keep home values lower this year, discouraging construction and delaying a rebound in housing. “You’re still dealing with a supply-demand imbalance that suggests home prices will remain under pressure,” said Tom Porcelli, , chief U.S. economist at RBC Capital Markets Corp. in New York. “Even though confidence has shown some improvement, we are still at an utterly depressed level.”