By Ruth Mantell, MarketWatch
WASHINGTON (MarketWatch) — Sales of new single-family homes in the U.S. rose in September to the highest rate in a year-and-a-half, according to government data released Wednesday that confirms the improving picture in the housing market.
Sales of new single-family homes in the U.S. rose 5.7% in September to a seasonally adjusted annual rate of 389,000, the highest pace since April 2010, when the first-time homebuyer tax credit was initially due to expire, the Commerce Department said.
The sales pace in August was revised down to 368,000 from a prior estimate of 373,000.
Economists surveyed by MarketWatch had expected new-home sales in September to rise to an annual rate of 387,000, given recent gains in other housing-market data, such as confidence among home builders, as well as housing starts and permits. See economic calendar.
Despite the gain in September, the pace of new home sales remains relatively low compared with a peak of almost 1.4 million in 2005. But it’s improved 38.9% from a series low of 280,000 in May 2010 as mortgage rates have hit record lows, foreclosures have dropped, and the jobs picture has slowly improved.
U.S. stocks SPX +0.14% were mildly higher on the session. An exchange-traded fund of home builders ITB +0.67% has more than doubled in the last year.
The median sales price in September shot up 11.7% year-on-year to $242,400.
The supply of new homes declined to 4.5 months at September’s sales rate from 4.7 months in August.
By region, sales in September fell only in the Midwest.
Ruth Mantell is a MarketWatch reporter based in Washington.
