New Home Sales Fall in October
The Commerce Department said the number of new, single-family homes sold in October fell 2.6 percent to a seasonally adjusted annual rate of 928,000 units compared to a pace of 953,000 units in September.
October's pace was much stronger than the 909,000 units forecast by Wall Street economists and stood 2.4 percent above year-ago levels.
But with inventory so tight in recent months, the prices of new homes rose to record levels. The mean prices of new U.S. homes rose to a record $218,400 from $204,300 in September while the median home price rose to $174,900 from $169,900 in the previous month.
But those prices may dip in the coming months as inventories eased in October in line with the slightly slower sales pace. The inventory of homes available for sale rose to 4.2 months of sales at the current pace, up from 4.0 months' worth at September's sales pace.
Sales of new homes slowed in the West by 8.9 percent, in the Midwest by 8.2 percent and fell 2.8 percent in the South. Sales rose 37.7 percent in the Northeast, a notoriously volatile region.
While most recent data have showed the U.S. economy slowing, housing data typically lags other economic indicators because the buyers' decision comes months before the final deal is closed and sellers continue to seek higher prices until demand slackens.