New home sales see slight increase

The United States Commerce Department reported new home sales for October at 728,000 units, up 1.7 percent from September’s sales of 716,000 but down 23.5 percent from the October 2006 figure of 952,000.

“The progressive tightening of mortgage lending conditions during 2007 has been the major factor behind the setback in home sales this year,” said David Seiders, chief economist at the National Association of Home Builders (NAHB). “NAHB expects home sales to begin a gradual recovery in the early part of 2008.”

The Commerce Department also reported the median sales price for new homes in October was $217,800, while the average sales price was $305,800.

The seasonally adjusted estimate of new houses for sale at the end of October was 516,000, an 8.5 month supply at the current sales rate.

The regional patterns of new home sales in October were mixed. New home sales increased 1.8 percent in the Northeast, 14.2 percent in the Midwest and 6.8 percent in the South. Sales were down by 15.7 percent in the West. All regions but the Northeast were down substantially on a year-over-year basis, according to the NAHB.

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