Sales of new single-family homes rose in May to 476,000, up 2.1 percent from the revised April figure of 466,000, which was more than analysts expected, according to a U.S. government report issued Tuesday. 

Wall Street expected sales to come in at an annualized rate of 462,000 units. The reading was the highest since July 2008.

The U.S. Census Bureau and the Department of Housing and Urban Development said the number was 29 percent above the May 2012 number of 369,000.

New-home sales are still below the 700,000 level that's considered to be the minimum measure of good economic health by most economists, but signs still point to a recovery of the U.S. housing market. 

"Against the backdrop of recent investor concerns over mortgage rate increases, we believe that our second quarter results, together with real-time feedback from our field associates, continue to point towards a solid housing recovery," Stuart Miller, Chief Executive Officer of the Lennar Corporation (NYSE:LEN), said Tuesday. 

"Our second quarter results reflect significant improvement in all of our key home building and financial services metrics," he said. "Demand in all of our markets continues to outpace supply, which is constrained by limited land availability and fewer competing home builders. At the same time, affordability remains high, and despite recent interest rate increases, we have seen very little impact on sales or pricing."