Purchases of new U.S. homes unexpectedly declined in October, showing limited progress in the housing market recovery.
Sales dropped 0.3% to a 368,000 annual pace following a revised 369,000 rate in September that was weaker than initially reported, figures from the Commerce Department showed today in Washington. The median estimate of 74 economists surveyed by Bloomberg News called for a 390,000 sales pace.
Purchases in the last six months have climbed 4.5%, showing uneven improvement as the residential real estate market remains restrained in part by limited access to credit. The figures help explain why Federal Reserve Chairman Ben S. Bernanke has singled out housing as one of the industries to nurture in order to spur the economic recovery.
Estimates in the Bloomberg survey ranged from sales rates of 365,000 to 418,000. The September reading was previously reported as a 389,000 annual pace.
The median price for a new house climbed 5.7% in October from the same month last year to $237,700 U.S.
Purchases increased in two of four regions last month, led by a 62.2% surge in the Midwest to the highest level in almost three years. Sales in the West jumped 8.8% to the fastest pace since July 2008.
Home purchases dropped 32.3% in the Northeast. The Commerce Department said in a statement that there was “minimal” effect on the data from superstorm Sandy.
The supply of homes rose to 4.8 months at the current sales rate from 4.7 months in September. There were 147,000 new houses on the market at the end of October compared with 145,000 a month earlier.
Sales of new homes, tabulated when contracts are signed, are considered a timelier barometer than purchases of previously owned dwellings, which are calculated when a contract closes. Newly constructed houses accounted for 6.7% of the residential market in 2011, down from a high of 15% during the boom of the past decade.
Previously owned homes sold at a 4.79 million rate in October, close to the two-year high 4.83 million pace reached in August, according to data released last week by the National Association of Realtors.
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