New home sales in U.S. rise to highest level in 14 years

Sept. 24 (UPI) -- Sales of new single-family homes in the United States climbed last month to the highest level in 14 years, government figures showed Thursday.

Data from the Commerce Department in its monthly report showed that August sales climbed by 4.8%, driven largely by low interest rates and high demand.

Sales reached a seasonally adjusted annual rate of slightly more than 1 million -- 43% higher over the past year.

The level of new home sales is the highest since 2006. Most experts had projected a slight decline for August.

The department said in its report Thursday July sales were revised up by 64,000 but the August median price for new homes was $312,800, a decline of about $14,000 year-to-year.

Despite a slowing economic recovery in the United States, new home sales are up due to low mortgage rates -- averaging below 3% -- and the release of demand that began building when COVID-19 kept homebuyers from viewing properties.

"Mortgage rates set several record lows over the last few months and have remained low into September," Freddie Mac chief economist Sam Khater said in a statement.

"While there is room for rates to decrease even more, higher home prices and low inventory could potentially stifle the high demand that we've been seeing."