Home builders are slowly reducing inventory.

According to Census Bureau data, the number of new homes slid 1 percent from May. On a seasonally-adjusted, annualized basis, home buyers bought 312,000 newly-built homes last month.

It’s the third straight month of falling sales and the headline data casts the Los Angeles housing market in a negative light.

Upon closer inspection, however, the numbers appear quite strong. 

First, sales are down marginally. Total units sold have dropped just 2 percent from the highs of the year. And, second, the number of newly-built homes for sale is down markedly from last year

There are 22% fewer new homes for sale today as compared to June 2010

At today’s sales pace, the complete new home inventory would be sold in 6.3 months – the quickest sell-out window since the expiration of the 2010 federal home buyer tax credit.

Builders are feeling better about their business, too.

After falling to a 9-month low, homebuilder confidence rebounded this month, boosted by expectations for a strong fall season. For buyers across California , this could be seen as a market-shifting signal.

When builder confidence rises, negotiating for upgrades and price reductions can be tougher; “good deals” get scarce.

If you’re a home buyer and are considering new construction, don’t let the headlines fool you. Sales figures are slipping, but that’s because there are fewer homes are for sale nationwide. The inventory is shrinking and that can push home prices higher.

With mortgage rates still low, today’s market may be your best value of the year.

The housing recovery showed particular weakness in the New Homes Sales category last month — good news for homebuyers around the country.

A “new home” is a home for which there’s no previous owner.

New Home Sales fell 11 percent from the month prior and posted the fewest units sold in a month since 1963 — the year the government first started tracking New Home Sales data.

Right now, there are roughly 234,000 new homes for sale nationwide and, at the current sales pace, it would take 9.1 months to sell them all. This is nearly 2 months longer than at October 2009′s pace.

The reasons for the spike in supply are varied:

• The original home buyer tax credit expired in November
• Weather conditions were awful in most of the country in January
• Weak employment and consumer confidence continue to hinder big ticket sales

Now, these might be less-than-optimal developments for the economy as a whole, but for buyers of new homes, it’s a welcome turn of events. Home prices are based on supply and demand, after all.

As a result, this season’s home buyers may be treated to “free” upgrades from home builders, plus seller concessions and lower sales prices overall.

It’s all a matter of timing, of course.  New Home Sales reports on a 1-month lag so it’s not necessarily reflective of the current, post-Super Bowl home buying season.  And from market to market, sales activity varies.

That said, mortgage rates remain low, home prices are steady, and the federal tax credit gives two more months to go under contract. It’s a favorable time to buy a new home.