U.S. sales of new homes slipped 2.1 percent in Nov.
In this Monday, Nov. 11, 2013 photo, a worker caulks the peak of a new condominium complex under construction in Pepper Pike, Ohio. The Commerce Department releases new home sales for November on Tuesday, Dec. 24, 2013. (AP Photo/Tony Dejak)
FILE - In this Monday, Nov. 4, 2013, file photo, visitors on the floor of the New York Stock Exchange use their smartphones and tablet devices to photograph the opening bell ceremonies. 2013 was a great year for the average investor, but few market strategists believe that 2014 will be anywhere near as good. (AP Photo/Richard Drew, File)
New-home sales dipped in November, but the government released more positive figures for the previous three months, a sign that housing may be regaining strength after a summer lull.
Sales slipped 2.1 percent last month to a seasonally adjusted annual rate of 464,000, the Commerce Department said Tuesday. The slight drop occurred after sales had surged to a rate of 474,000 in October. That was the fastest pace since 2008 and was 17.6 percent above the September level – the biggest one-month jump in 21 years.
The annual pace of new-home sales remains well below the 700,000 generally consistent with a healthy market. But economists are encouraged by a pickup in sales after a slowdown likely caused by higher mortgage rates.
Mortgage rates had spiked amid investor concerns about how fast the Federal Reserve would remove its support for the economy.
The government’s report Tuesday revised up new-home sales for the three months preceding November. August’s total was revised up by 9,000, September’s by 49,000 and October’s by 30,000.
“The rebound in sales following the sharp slowdown in July was much stronger than originally reported,” said Michael Gapen, an economist at Barclays.
Mark Vitner, senior economist at Wells Fargo, said, “The housing recovery remains well in place.”
He noted that mortgage rates are still low by historic standards and should support sales next year. Vitner predicted that new-home sales would rise next year to an annual pace of around 530,000.
In a separate report, the Mortgage Bankers Association said the number of Americans applying for mortgages fell 6.3 percent last week from the previous week. Applications have reached a 13-year low, down 63 percent from their May peak.
Much of the decline reflects a drop-off in refinancings as rates have risen. The average for the 30-year mortgage was 4.47 percent last week, up nearly a full percentage point from last spring.
In November, sales rose 15.2 percent in the Northeast.