New US Home Sales Exceeded Expectations in January

New US home sales increased more than expected in January, supported by record low mortgage rates and a severe shortage of existing homes for sale.

The US Commerce Department report on Wednesday shows continued housing market support for the economy’s recovery from the COVID-19 recession. But momentum may ebb in the near term, after the devastation wrought by winter storms this summer in Texas and large parts of the south.

New home sales rose 4.3% to a seasonally adjusted annual pace of 923,000 units last month. The ministry raised its estimate for the December sales figure to 885 One thousand units from 842 thousand in the previous report. Economists polled by Reuters had expected new home sales to rise 2.1% to a rate of 855,000 units in January.

New home sales account for 12.1% of all home sales in the United States.

The average new home price increased 5.3% from a year ago to $346,400 in January.