After reporting a substantial increase in U.S. new home sales in the previous month, the Commerce Department released a report on Monday showing a sharp pullback in new home sales in the month of August.
The report said new home sales tumbled by 7.6 percent to an annual rate of 609,000 in August after surging up by 13.8 percent to a revised 659,000 in July.
Economists had expected new home sales to drop to a rate of 598,000 from the 654,000 originally reported for the previous month.
The decrease in new home sales comes after they reached their highest annual rate in well over eight years in July.
New home sales in the Northeast plunged by 34.3 percent to a rate of 23,000, and new home sales in the South plummeted by 12.3 percent to a rate of 343,000.
The report also showed a 2.4 percent drop in new home sales in the Midwest, while the West saw an 8.0 percent jump in new home sales.
The Commerce Department said the median sales price of new houses sold in August was $284,000, down 3.1 percent from $293,100 in July and down 5.4 percent from $ 300,200 a year ago.
The estimate of new houses for sale at the end of August was 235,000, representing a supply of 4.6 months at the current sales rate.
Last Thursday, the National Association of Realtors released a report showing an unexpected decrease in existing home sales in the month of August.
The report said existing home sales slid 0.9 percent to an annual rate of 5.33 million in August after tumbling by 3.4 percent to a downwardly revised 5.38 million in July.
The continued decrease in existing home sales surprised economists, who had expected sales to climb to a rate of 5.44 million from the 5.39 million originally reported for the previous month.
NAR said the unexpected drop pulled existing home sales down to their second lowest pace of 2016, although sales are still up by 0.8 percent compared to 5.29 million in the same month last year.
by RTT Staff Writer
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