• July new home sales rose 12.4 percent from June to 654,000 units (SAAR), according to the Census Bureau, the largest month-over-month increase in more than two years.
• New home sales reached their highest level since October 2007, but remain 53 percent below their pre-crisis peak recorded in July 2005.
• New home sales have beat expectations in each of the past nine straight months, suggesting a tangible turnaround from stubbornly low sales for much of the housing market recovery.

July new home sales rose 12.4 percent from June to 654,000 units at a seasonally adjusted annual rate (SAAR), their highest level since October 2007 (figure 1). Over the year, new home sales are up 31.3 percent, the highest annual growth rate since February 2012.

New home sales have met or exceeded expectations for nine consecutive months now, suggesting a tangible turnaround from the persistently low levels of new home sales that have characterized much of the housing market recovery since 2012. However, even with recent gains, new home sales remain 53 percent below their pre-crisis peak recorded in July 2005, roughly on par with levels seen in the early 1990s. In the South, new home sales are “only” 43 percent below their pre-crisis peak while elsewhere in the country they are in the range of 66 to 69 percent below pre-crisis highs.

The median seasonally adjusted price of new homes sold in July pulled back 5 percent from June, to $298,200, down 0.4 percent from last July. The inventory of new homes for sale fell 2.9 percent from June to 233,000 units (SAAR), the largest month-over-month pull back in new home inventory since April 2011. Still, over the year, new home inventory is up 8.4 percent.