Sales of new homes reach highest level in six years in August
A housing development is seen under construction in Zelienople, Pa., last fall.
Sales of newly built homes in the U.S. surged in August to their highest level in six years, according to new figures out Wednesday.
The Commerce Department estimated that new home sales climbed 18% from July, to an annual rate of 504,000. That’s one-third above the level seen a year ago and the highest recorded since May 2008. The number of new homes sold in the West climbed by 50% last month.
While the report can be volatile -- new home sales increased just 2% in July and fell in June -- it’s another indication of a housing market that is starting to stabilize. Many economists say that low inventory, especially of newly built homes, has been holding back the recovery. If builders are starting to close more sales, they may start building more aggressively. Last week, a builders trade group reported that its members were the most confident they had been in nine years.
Still, sales of new homes are less than half what they were in the mid-2000s, a sign that any recovery still has a long way to go.
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