New-home sales picked up in September, but hefty downward revisions to sales in earlier months point to a market still struggling for momentum. Sales ran at a seasonally adjusted annual rate of 593,000, the Commerce Department said Wednesday. That was 3.1% higher than August’s figures, which had originally been reported as 609,000. Sales in September were 29.8% higher compared to a year ago. Economists surveyed by MarketWatch had forecast a slight downturn to a 600,000 annual pace. In all, revisions to prior months took 85,000 off earlier estimates and leaves September with the second-highest pace of the recovery. The median price of new homes sold in September was $313,500, 6.7% higher than in August, and 1.9% higher than a year ago. In part, that reflects dwindling supply. There were 4.8 months’ worth of homes available for sale at the current pace in September, fewer than in August. Also read: A city-by-city look at U.S. house prices in August Despite robust demand, builders haven’t ramped up construction of new homes since the recession. Many continue to report difficulties in finding affordable labor and lots. But some analysts note that builders can reap fatter margins by keeping inventories lean and targeting higher-end customers. PulteGroup Inc PHM, +0.78% last week said earnings grew 19% and orders increased 17% in the quarter ending in September. So far in 2016, new home sales have averaged a 564,000 annual pace —13% higher than during the same period a year ago.

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