WASHINGTON (AFP) — New home sales increased 1.7 percent in October but the rise came only after a sharp downward revision to September figures, the Commerce Department said Thursday.
The report, which also showed a sharp decline in home prices, suggested that homebuilders and the entire housing market are still being pressured by a horrific slump.
The report showed home sales up 1.7 percent for the month to an annual pace of 728,000 units, the biggest increase since April.
But the agency made a sharp downward revision to September data to show an pace of just 716,000, the lowest since January 1996. The figure reported last momth was much higher at 770,000.
Over the past 12 months, US sales of new homes are off 23.5 percent, reflecting the slump in the property market after several sizzling years of growth.
The latest report suggests buildrs are cutting prices in an effort to clear out inventories.
The median price of a new home was down 8.6 percent from September and down 13 percent from October 2006 to 217,8000. The October drop was the sharpest since September 1981.
In one positive sign, new home inventories fell 2.3 percent to 516,000, representing a supply of 8.5 months at the current sales pace, compared with a nine-month inventory in September.
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