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New
home sales jumped 10.6% to a seasonally adjusted annual rate of
739,000 units last month, the highest level since May 2023, the
Commerce Department's Census Bureau said on Friday. It was also
the sharpest increase in sales since August 2022.
The sales pace for June was revised higher to 668,000 units from
a previously reported 617,000 units.
Economists polled by Reuters had forecast new home sales, which
account for more than 10% of U.S. home sales, to edge up to a
rate of 625,000 units.
New home sales are counted at the signing of a contract. They,
however, can be volatile on a month-to-month basis. Sales
increased 5.6% on a year-on-year basis in July.
The average rate on a 30-year fixed-rate mortgage was 6.46% this
week, the lowest since May 2023, and more than half a percentage
point lower than the same time last year, data from mortgage
finance agency Freddie Mac showed.
It has eased from a six-month high of 7.22% in early May amid
signals from the Federal Reserve that it will deliver a
long-awaited interest rate cut in September. That could help to
stimulate sales in the future.
Other housing data has been mixed. U.S. existing home sales rose
more than expected in July, reversing a four-month decline.
However, single-family housing starts dropped to a 16-month low
in July, likely weighed down by Hurricane Beryl while permits
for future construction also edged down.
(Reporting by Lindsay Dunsmuir; Editing by Chizu Nomiyama)
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