New U.S. single-family home sales unexpectedly rose in September, pointing to sustained demand for housing even as data for the prior three months were revised lower.
Other reports today suggested a stronger pickup in economic growth in the third quarter than is currently anticipated, Reuters reports. The goods trade deficit narrowed sharply, while both wholesale and retail inventories increased in September.
“A lot of the pieces of the puzzle have come back together in a positive direction, with a pickup in the export of goods to the rest of the world and new home sales,” says Chris Rupkey, chief economist at MUFG Union Bank in New York.
The Commerce Department says new home sales increased 3.1% to a seasonally adjusted annual rate of 593,000 units last month, pulling them close to a nine-year high touched in July. However, the pace for the prior three months was revised down by a total of 85,000 units from previous estimates.
New home sales, which are derived from building permits, are volatile on a month-to-month basis and subject to large revisions. Sales increased 29.8% from a year ago.
Economists had forecast single-family home sales, which account for about 9.8% of overall home sales, falling to a rate of 600,000 units last month.
“The housing market may not be booming, but it is clearly moving forward at a steady pace,” says Joel Naroff, chief economist at Naroff Economic Advisors in Holland, Pennsylvania. “But the big problem is still the lack of inventory. Builders are cautious and tend to do very little speculative construction.”
