New Home Sales august
Daniel Acker/Bloomberg via Getty Images
By Jason Lange

WASHINGTON -- Sales of new single-family homes in America rose in August but held near their lowest levels this year, a sign that a sharp rise in interest rates is weighing on the U.S. economy.

Sales rose 7.9 percent to an annual rate of 421,000 units, the Commerce Department said Wednesday.

The pace of sales was in line with analyst expectations and supported the view that rising mortgage rates were taking steam out of America's housing recovery.

August's increase in new home sales didn't make up for the steep drop registered in July, when the pace of sales was the weakest since October.

Mortgage rates surged beginning in May when the Federal Reserve gave signals it was thinking of winding down a bond-buying stimulus program. The Fed surprised financial markets last week when it said it would put off reducing monthly bond purchases for now. Policymakers said rising borrowing costs played a role in their decision.

The housing market, which has been a major drag on America's economy since the 2007-09 recession, appeared to turn a corner early last year when home prices began to rise.

Last month, the median price for a new home sale fell to $254,600. The median sales price, which is not adjusted for seasonal swings, has fallen every month since May, although is still up slightly from August 2012.

The inventory of new homes for sale increased by 3.6 percent in August from July, leaving the stock of unsold new homes at its highest level since March 2011.

Increase your money and finance knowledge from home

Introduction to Preferred Shares

Learn the difference between preferred and common shares.

View Course »

How to Avoid Financial Scams

Avoid getting duped by financial scams.

View Course »

Add a Comment

*0 / 3000 Character Maximum


Filter by:
The Paterfamilia

85,000,000,000.00 PER MONTH... That is how much the Fderal Reserve prints and gives to the Banks for Bonds to raise the pool of Cash to loan for Homes... Yet the Banks RAISED their APR almost 2% right in the middle of the Home Buying Season and have continued to hold or raise it more... That said, they raised those rates on th Federal Reserve Chairs WARNING that he was merely THINKING of EASING his yet on going Quantitive Stimulus Program by slightly TAPERING the amount slowly NEXT YEAR or at years end.

BUT THEY DIDN'T!!! Has the Banks EASED their increased APR? NO, NADA!!! They are holding and or still increasing their WINDFALL'S even after several QUARTERS of RECORD PROFITS... Dumb dumb (flexles) here thinks they should go to 10%? WOW... Why in the name of **** would anyone want to save U. S. Dollars while they are printing them at Maximum Speed that only deflates their values?

I'm expecting riots in the streets any day with the GOP cutting 40 BILLION in food for the poor especially when it hits home that they are Printing more than twice that for the Banks that are flooded in Cash and could care less about Humanity... Capitalism is such a poor replacement for a DEMOCRACY... This is why the NSA focuses on spying on "We The People" rather than Russia, China or any other Super Powers... The whole world bases their values on the U. S. Dollar!!! What a SCAM...

September 25 2013 at 6:14 PM Report abuse +1 rate up rate down Reply

high morgage rate are you kidding I payed 8% my sister payyed 10 percent we both payed our houses off I would like to see at 7 so savers can earn some money on there money these rate are lower than my parents had

September 25 2013 at 11:51 AM Report abuse rate up rate down Reply
1 reply to flexles's comment
The Paterfamilia

You are one sick MF... Being Humane describes a Human-Like Relationship and requires no Dogs... That said, even Dogs get the Crumb's from off the floor that fall from the tables and what your saying here is Human Being's don't even deserve that... Give them less and keep even more... SAVE!!!

The Paterfamilias- ;>D} No Offense intended, just Insight and Logic...

September 25 2013 at 6:22 PM Report abuse +1 rate up rate down Reply