New Single-Family Home Sales Increase 10.6% in September

Sales of new homes, bolstered by low mortgage rates and strong demand in the Northeast, rose 10.6% in September to break a string of five consecutive monthly declines, the government reported Thursday.

The Commerce Department said new single-family homes were sold at a seasonally adjusted annual rate of 690,000 units in September, against a rate of 624,000 units in August.

The September increase was the first improvement since March, when sales had soared 24.7% to an annual rate of 924,000 units as dramatic declines in mortgage rates spurred a boom in the housing industry.

Since then, sales had fallen in every month, including a 10.2% decline in August. Analysts said potential buyers became discouraged by lengthy delays in processing loan applications and by an upturn in mortgage rates.

But they said recent declines in mortgage rates plus the elimination of the long loan-processing delays had encouraged buyers to enter the market again.

For the first nine months of the year, sales totaled 595,000 units.