New single-family homes sold at a seasonally adjusted annual rate of 1,028,000 units last month, a climb from the upwardly revised pace of 951,000 in April.

May was the first time that new homes had sold at an annual pace greater than 1 million units, and marked the biggest jump since November 2001. The previous record clip was 979,000 in Dec. 2001.

May home sales crushed the expectations of analysts who had forecast a 921,000 pace. Inventories rose to 324,000 homes in May from 320,000 the previous month, the highest level since November 1996.

The supply of new homes available for sale at the current sales pace was 3.8 months' worth, the first time the supply has dipped below four months since December 2001.

Home sales jumped 10.6 percent in the South, the busiest home sales region in the country.

Sales rose 4.3 percent in the West, 2.7 percent in the Midwest and 26.4 percent in the Northeast.