WASHINGTON (August 23, 2013)—New home sales dropped sharply in July, a sign that higher mortgage rates may weigh on the housing recovery, the U.S. Commerce Department said Friday.
The Commerce Department says new-home sales dropped 13.4 percent to a seasonally adjusted annual rate of 394,000, down from a sales pace of 455,000 in June, which was revised sharply lower from a previously reported 497,000.
Other reports suggest higher mortgage rates could be slowing the housing market's momentum.
In July, builders started work on the fewest single-family homes in eight months and mortgage applications from potential buyers have fallen since rates have risen more than a full percentage point.
Still, most economists expect the housing recovery will persist; even after July's steep drop, new-home sales were 7 percent higher than 12 months earlier.
Viewers with disabilities can get assistance accessing this station's FCC Public Inspection File by contacting the station with the information listed below. Questions or concerns relating to the accessibility of the FCC's online public file system should be directed to the FCC at 888-225-5322, 888-835-5322 (TTY), or firstname.lastname@example.org.