A shortage of homes on the market and rising costs for material such as lumber and also higher labor costs are fueling the price increase. The report on new homes followed news last week that sales of existing homes rose 1.4% in June to a seasonally adjusted annual rate of 5.86 million units with the median price of an existing home hitting a record high of $363,300, up 23.4% from a year ago.
The June sales decline left sales at a seasonally adjusted annual rate of 676,000, the Commerce Department reported Monday. That followed a 7.7% sales decline in May. The median price of a new home sold in May was $361,800, up 6.1% from a year ago.
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