WASHINGTON (AP) – Sales of new homes recovered in October after suffering a steep drop in September, indicating a return to stability in the housing market.
The Commerce Department says new-home sales climbed 10.7 percent last month to a seasonally adjusted annual rate of 495,000. This rebound followed a 12.9 percent plunge in the sales rate during September.
Americans recovered much of their appetite for owning new homes this year. Purchases have surged 15.7 percent year-to-date, benefiting from the solid hiring gains and low mortgage rates.
The new-home sales report tends to be volatile from month to month. Home-buying surged 135.5 percent in the Northeast in October, while rising less aggressively in the Midwest and South. Sales dropped slightly in the West.
But prices dipped last month despite other industry reports indicating that real estate prices have eclipsed income growth. In October, the median new-home sales price fell 8.5 percent from a year ago to $281,500.