Home builders pull back on price cuts
The National Association of Home Builders (NAHB) has pointed to fewer builders lowering home prices as more evidence of a housing rebound.
According to the latest Housing Market Index (HMI) survey, the rate of home builders cutting prices to boost sales dropped to 15% in May.
The previous survey showed that 22% of builders cut prices in April.
In March 2008, during the last housing recession, about 49% of builders dropped prices, the NAHB said.
Builders who reduced prices in May cut them by an average of 5%, the same discount reported a month earlier. In contrast, builders were reducing home prices more aggressively in May 2007 (7%) and March 2008 (8%).
As economic turmoil has hit the United States as a result of the COVID-19 crisis, the NAHB has said that housing will help lead the nation out of recession levels.
Sales of new single-family homes demonstrated strength last month, rising 16.6% to a seasonally adjusted annual rate of 676,000 from the revised April rate of 580,000.