US new-home sales surge 5.7 percent in August to 7-year high

Source: AP

By CHRISTOPHER S. RUGABER

WASHINGTON (AP) — Buoyed by steady job gains and low mortgage rates, Americans purchased new homes in August at the fastest pace in more than seven years.

New-home sales surged 5.7 percent last month to a seasonally adjusted annual rate of 552,000, the Commerce Department said Thursday. That is the strongest pace since February 2008, near the beginning of the Great Recession. Last month's increase followed an even bigger 12 percent jump in July, according to the government's revised figures.

Healthy hiring and smaller price increases for new homes have finally begun pushing up sales, which were hammered during the Great Recession and recovered slowly even after the downturn ended in 2009. New home sales have soared nearly 22 percent in the past year.

Strong gains in new-home sales could accelerate the economy by boosting home building, which generates construction jobs, demand for more building materials and more spending on landscaping and other services.

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FILE - In this June 9, 2015 file photo, a sold sign is displayed in the yard of a newly built home in the Briar Chapel community in Chapel Hill, N.C. The Commerce Department reports on sales of new homes in August on Thursday, Sept. 24, 2015. (AP Photo/Gerry Broome, File)

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