New-home sales rose 2.6% in January, the second consecutive monthly increase, and the median price of a new home soared by the highest percentage in almost 20 years, the government said Monday.
New single-family homes were sold at a seasonally adjusted annual rate of 620,000 units in January, following a 1.3% sales gain last December, according to the Commerce and Housing and Urban Development departments.
The median price of a new home climbed by 7.9% in January to $84,500, meaning that half of the homes sold cost more than that and half cost less.
It was the biggest monthly price increase since a 10.6% jump in April, 1966, when the median price went from $20,800 to $23,000.
The average price of a home increased at a slower rate of 2.3% in January to $98,500.
Steve Berman, a Commerce Department housing analyst, said he doubted that the big increase meant that inflation was accelerating in the home-sales market.
In the final three months of 1984, he said, median home prices actually declined by 0.1%. He said month-to-month changes can fluctuate greatly.
Some private analysts said the big price jump could mean that buyers are bidding up prices for low and moderately priced homes.
For all of 1984, the median price of a home rose 6.1%.
The January sales increase was the biggest since a 20.3% surge last September. Analysts attributed the gains to lower mortgage rates.
Mortgage rates hit a peak last year of 15.23% in July for fixed-rate conventional loans. Those rates had dropped to 13.67% in early January, according to a survey by the Federal Home Loan Bank Board.
Private analysts said rates have dipped lower since then, with fixed-rate loans going for 12% to 13% in most parts of the country.
John Koelemij, president of the Natiional ASsn. of Home Builders, said the decline in rates since last July has shaved $100 off the monthly mortgage bill for a loan of $72,000.
"Fixed-rate mortgages in the 12% to 13% range are viewed as extremely attractive financing," he said. "Consumers are confident and the underlying demand for housing is strong in most areas."