New home sales surge 11% in June
* New home sales surged 11% to a seasonally adjusted annual rate of 384,000 from 346,000 in May. That was stronger than the average forecast of economists polled by Bloomberg, who were expecting 352,000 sales. Regionally, sales rose 22.6% in the West, gained 29.2% in the Northeast, and shot up 43.1% in the Midwest. Sales dipped 5.3% in the South.
* The raw number of homes for sale continued to decline, falling to 281,000 from 293,000 in May. That's the lowest reading going back to February 1998. The months supply at current sales pace indicator of inventory slumped to 8.8 months from 10.2.
* The median price of a new home fell 5.8% last month to $206,200 from $219,000 in May. On a year-over-year basis, prices dropped 12%, the biggest YOY decline since February.
What's happening in the new housing market? Falling prices are generating more sales and clearing out the inventory glut. Specifically, prices declined 12% from a year earlier in June. That was the biggest annual drop since February. Sales spiked 11%, while the raw number of homes on the market dropped to the lowest level in 11 years.
The existing home market is struggling a bit harder, thanks to a continuing influx of foreclosed and delinquent properties. But overall, the tone of the housing news is generally improving. That's a welcome sign after so many quarters of disappointment.