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The Commerce Department said sales of newly built homes rose at an annual rate of 369,000 last month.
Sales of new homes in the United States hit a two-year high in May, jumping 7.6 percent over April.
Data released Monday by the Commerce Department showed sales of newly built homes rose at an annual rate of 369,000 last month, Reuters reported.
More from GlobalPost: US new home sales rise 3.3% in April
That was higher than the 346,000 rate economists had expected.
"The housing market recovery remains on track. While we still have a long ways to go, healing is taking place and we are starting to see improvement," Sam Bullard, a senior economist at Wells Fargo Securities, told Reuters.
More from GlobalPost: US existing home sales fell in May
Prices for new homes, meanwhile, rose 5.6 percent in May from the same month a year ago to a median of $234,500, the Wall Street Journal reported.
MarketWatch reported that new home sales are 19.8 percent higher compared to one year ago. Low interest rates, warmer weather and attractive prices all helped.
But even with the gains, the annual sales pace is less than half the 700,000 that economists consider to be healthy, The Associated Press reported.
Sales of previously occupied homes fell in May to a seasonally adjusted sales rate of 4.55 million after nearly touching a two-year high in April, although re-sales were up 9.6 percent from the same month last year, according to the AP.