Homebuilders boosted by strong sales report

|By:, SA News Editor

Homebuilders (ITB +1%), (XHB +0.7%) are on the rise early after existing home sales rise 4.9% to a seasonally-adjusted rate of 4.89M in May, ahead of expectations for 4.75M.

The 4.9% monthly gain was the fastest rise since August 2011, but the 4.89M pace is 5% lower than a year ago.

The NAR's Larry Yun notes slower price growth thanks to rising inventory along with a downtick in mortgage rates as boosting business.

Total housing inventory of 2.28M homes for sale is a 5.6 month supply at the current sales pace, down from 5.7 months in April, but 6% higher than a year ago.

The median home price of $213.4K is 5.1% higher than a year ago. Distressed home sales of 11% falls from 18%.

The percent of first-time homebuyers continues to disappoint, down to 27% in May from 29% in April and 29% a year before that.

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