New home sales were down 27% in May, according to a John Burns Real Estate Consulting (JBREC) survey of builders. According to the monthly report, net sales per community were 1.35 units per community, down from last month’s 1.84 units per community. Builders also reported a decline in new housing starts in eight of 10 regions, as builders felt little hurry to start more homes. This echoes the results of a government report that showed the seasonally adjusted annual rate of housing starts declined 10% in May. According to John Burns, CEO of the Irvine, Calif.-based firm conducting the survey, it’s an expected drop that came after the end of the homebuyer tax credit deadline. “This isn’t a crash,” Burns said. “This is exactly what we thought would happen. Many of the home buyers who would have bought in May, purchased in April instead because of the tax credit.” The survey also reports that builders are in for a tough few months as traffic — a leading indicator of future sales — is down. Not only that, builders that provided commentary to JBREC complained about the “poor quality” and “lack of urgency” in potential buyers. The survey gauged perceptions of 236 home building executives from 88 markets that reported on conditions in more than 1,900 communities. Builders reported a decline in backlogs, the result of slower sales. Nationally, builders expect a 22% decrease in backlogs. While sales declined 34% in Texas, the most of any state, prices are also going up, the survey reported. South Florida is also seeing an increase in prices for new homes. However, most other regions experienced small price declines. “Thus far, the price correction has been only minor. Falling mortgage rates, great affordability and positive job growth will build demand back up,” Burns said. “The real question has to do with how many distressed homes will be dumped on the market. Those numbers are rising.” Write to Austin Kilgore.