Washington, DC CNN —New home sales surged in May, as buyers looked to new construction as an alternative to the low inventory of existing homes for sale. Homeowners with ultra-low mortgage rates are reluctant to sell and buy another home at a much higher rate. Sales of existing homes have been down for the past few months, while new home sales have been rising. Mortgage rates reached as high as 6.79% at the end of May as uncertainty moved through the financial industry due to the debt ceiling standoff. This increase in mortgage rates cooled mortgage applications.

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Persons: “, ”, Nancy Vanden Houten, Ryan Sweet, Eugenio Aleman, Raymond James, ” Aleman Organizations: DC CNN, US Department of Housing, Urban Development, Census Bureau, Oxford Economics, Federal Reserve Locations: Washington, Northeast, South, West