Sales of New Homes Rise 1.4% in July; Top Rate Since ’83

Sales of new homes climbed 1.4% in July, pushing housing sales to their highest level in a year and a half, the government reported today.

New single-family homes were sold at an annual rate of 704,000 last month, the highest since a rate of 767,000 sales in December, 1983, according to the report from the Departments of Commerce and Housing and Urban Development.

Even more encouraging was the fact that the government substantially raised its estimates of housing sales from April through June.

June sales originally had been reported at a 0.1% decline. However, today’s report revised that to a strong 2.2% increase after a 4.6% May gain.

Housing sales had been a major disappointment to analysts because of the reported June weakness. Analysts had been looking for much stronger sales because of the sharp declines in mortgage rates, which now stand at their lowest level in five years.