New home sales in the U.S. rebounded by much more than expected in the month of September, according to a report released by the Commerce Department on Thursday.
The Commerce Department said new home sales surged by 4.1 percent to an annual rate of 738,000 in September after tumbling by 2.3 percent to a revised rate of 709,000 in August.
Economists had expected new home sales to climb by 0.5 percent to an annual rate of 720,000 from the 716,000 originally reported for the previous month.
With the much bigger than expected increase, new home sales reached their highest level since hitting an annual rate of 741,000 in May 2023.
The report said new home sales in the Northeast skyrocketed by 21.7 percent to an annual rate of 28,000, while new home sales in the South spiked by 5.8 percent to an annual rate of 477,000.
Meanwhile, new home sales in the West were unchanged at an annual rate of 156,000, and new home sales in the Midwest slumped by 2.5 percent to an annual rate of 77,000.
The Commerce Department also said the median sales price of new houses sold in September was $426,300, up 3.8 percent from $410,900 in August and up 0.1 percent from $426,100 a year ago.
The estimate of new houses for sale at the end of September was 470,000, which represents 7.6 months of supply at the current sales rate. The months of supply is down from 7.9 in August but up from 7.5 in September 2023.
A separate report released by the National Association of Realtors on Wednesday unexpectedly showed a continued decrease by existing home sales in the U.S. in the month of September.
NAR said existing home sales slid by 1.0 percent to an annual rate of 3.84 million in September after tumbling by 2.0 percent to a revised rate of 3.88 million in August.
Economists had expected existing home sales to increase by 1.0 percent to a rate of 3.90 million from the 3.86 million originally reported for the previous month.