New Home Sales Jump in June

Sales of new homes jumped in June, but it was the second-weakest month on record.

New home sales rose nearly 24 percent in June from a month earlier to a seasonally adjusted annual sales pace of 330,000. May's number was revised downward to a rate of 267,000, the slowest pace on records dating back to 1963. Sales for April and March were also revised downward.

The housing market had boomed earlier in the year on the strength of federal tax credits. Since they have expired, the number of people looking to buy has dropped even with the lowest mortgage rates in decades.

New homes sales made up about 7 percent of the housing market last year. That's down from about 15 percent before the bust. Weak sales mean fewer jobs in the construction industry, which normally power economic recoveries.

uilders have sharply scaled back construction in the face of a severe housing market bust. The number of new homes up for sale in March fell 1.4 percent to 210,000, the lowest level in nearly 42 years.

Due to the sluggish sales pace, it would still take eight months to exhaust that supply, above a healthy level of about six months.