WASHINGTON, Nov 24 (Reuters) – New U.S. single-family home
sales fell unexpectedly in October and prices dropped to a
seven-year low, a government report showed on Wednesday,
pointing sustained weakness in the housing market following the
end of a home-buyer tax credit.
The Commerce Department said sales dropped 8.1 percent to a
283,000 unit annual rate after an upwardly revised 308,000 unit
pace in September.
Analysts polled by Reuters had forecast new home sales
rising to a 310,000 unit pace in October. Compared to October
last year, sales were down 28.5 percent.
Housing remains one of the weak spots in the economy, which
is showing some strength. With unemployment stuck at an
uncomfortably high 9.6 percent, homeowners are struggling to
hang on to their houses, keeping the foreclosure wave high and
stifling the sector’s recovery. Data on Tuesday showed a drop
in the sales of previously owned homes last month.
October’s weak sales pace pushed up the supply of new
homes on the market to 8.6 months’ worth from 7.9 months’ worth
in September. However, there were 202,000 new homes available
for sale in October, the lowest since June 1968.
The median sale price for a new home dropped a record 13.9
percent last month from September to $194,900, the lowest since
October 2003. Compared to October last year, the median price
fell 9.4 percent, the largest drop since July 2009.

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