New home sales rose at the fastest pace in more than 20 years last month, hitting levels not seen since 2008.  The Census Bureau and the Department of Housing and Urban Development report that sales of newly constructed homes in May were at a seasonally adjusted annual rate of 504,000, 18.6 percent higher than April and a 16.9 percent gain over sales in May 2013.  April numbers were revised to 425,000 from the 433,000 reported earlier.

On a non-seasonally adjusted basis there were 49,000 new homes sold in May.  In April non-adjusted sales totaled 40,000, identical to the number sold in May 2013.

At the end of the reporting period there were an estimated 189,000 new homes for sale nationwide, 109,000 of which were under construction.  This is an estimated 4.5 month supply at the current pace of sales.  While the number of homes for sale are essentially the same as in April, the supply is down from the 5.3 month inventory estimated that month.  In May 2013 there were 162,000 homes for sale, also a 5.3 month supply.

The median price of a newly constructed home sold during the month was $282,000 and the average price was $319,200.   In May 2013 the median price was 263,700 and the average was $314,000.

Regionally the strongest showing was in the Northeast where new home sales were up 54.5 percent from April and 36.0 percent from one year earlier.  In the Midwest there was a monthly increase in the rate of sales of 1.4 percent and 5.7 percent on an annual basis.  Sales in the South were up 14.2 percent and 11.8 percent for the respective time periods.  There were also substantial gains in the West where May sales were 34.0 percent higher than in April and 32.7 percent above those one year earlier.

Homes that sold in May were on the market a median of 3.3 months.  One year earlier the median marketing period was 4.5 months.