New home sales hit six-year high, but they’re still struggling

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New home sales hit six-year high, but they’re still struggling

By Dina ElBoghdady September 24 at 1:14 PM

newhomesales9-24-14While the sales of newly-built homes hit a six-year high in August, the numbers aren’t as dazzling as they seem when put in context.

New home sales jumped 18 percent last month from July to a seasonally adjusted annual rate of 504,000, the Census Bureau and the Department of Housing and Urban Development reported Wednesday. That’s 33 percent higher than a year earlier, when home prices and mortgage interest rates were climbing.

Last month’s performance blew past the expectations of many economists, including the 74 surveyed by Bloomberg, whose median prediction for the pace of  new home sales was 430,000. The activity also stands in stark contrast to the 1.8 percent drop in sales of previously-built homes last month.

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