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New US home sales spike 18.9%, hit 10-year high in September

The Commerce Department said on Wednesday new home sales surged 18.9 per cent to a seasonally adjusted annual rate of 667,000 units last month amid an increase in all four regions

Reuters  |  Washington 

US new home sales race to nearly 10-year high in September

of new single-family homes unexpectedly rose in September, hitting their highest level in nearly 10 years, offering hope that the market was regaining speed after appearing to stall recent months.

The Commerce Department said on Wednesday new home surged 18.9 per cent to a seasonally adjusted annual rate of 667,000 units last month amid an increase in all four regions. That was the highest level since October 2007 and followed August's upwardly revised pace of 561,000 units.

The percent gain was the largest since January 1992. August's pace was previously reported at 560,000 units.

Economists polled by Reuters had forecast new home sales, which account for 11 per cent of overall home sales, falling 0.9 per cent to a pace of 555,000 units last month.

New home sales, which are drawn from permits, are volatile on a month-to-month basis. soared 17.0 per cent on a year-on-year basis in September. The market has trod water for much of this year, amid shortages of homes available for sale, skilled and suitable land for building.

Activity was also hampered by Hurricanes Harvey and Irma, which weighed on homebuilding in September and hurt of previously owned homes in the South. is expected to have been a drag on economic in the third quarter.

In September, new single-family homes raced to a more than 9-1/2 year high in the Northeast. in the South hit their highest level since July 2007. There were also strong gains in the West and Midwest last month.

More than two-thirds of the new homes sold last month were either under construction or yet to be started.

With surging in September, the inventory of new homes on the market was unchanged at 279,000 units. At September's robust pace it would take 5.0 months to clear the supply of houses on the market, down from 6.0 months in August.

A six-month supply is viewed as a healthy balance between supply and demand.

First Published: Wed, October 25 2017. 21:28 IST
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