By Josh Mitchell and Eric Morath
WASHINGTON-New-home sales fell in November, a sign of unsteadiness in the housing market despite ultra-low interest rates and sturdy economic growth.
Sales of newly built, single-family homes declined 1.6% in November from a month earlier to a seasonally adjusted annual rate of 438,000, the Commerce Department said Tuesday. Economists surveyed by The Wall Street Journal had expected sales to reach a pace of 460,000.
New-home purchases fell 2.2% in October to a rate of 445,000, lower than the initial estimate of 458,000.
New-home sales represent about a tenth of the overall housing market, and monthly figures are often revised. The broader trend suggests a choppy market struggling to lift off. Compared to a year earlier, new-home sales were also 1.6% lower in November.
New-home sales are running at less than half their annual average of the 2000s, as the housing market lags the broader economic recovery. The economy grew at a robust pace in the spring and summer, and the U.S. is on track to post the strongest year of job growth since 1999. Consumer confidence is rising.
Meanwhile, mortgage rates have retreated after rising last year. The average 30-year fixed-rate mortgage has slipped below 4%, according to Freddie Mac.
Several factors could be holding back housing. Lenders continue to impose tight credit standards, giving loans to only those with high credit scores. Many families lack money for down payments.
Also, inventory has been tight, limiting consumer options, and home values have risen steadily, denting affordability.
Wednesday's report showed housing stock built up as sales fell. At the November selling pace, it would take 5.8 months to exhaust the supply of newly built homes on the market.
The price of the typical home has climbed. The median price of a newly built home stood at 280,900 in November, up from $277,100 a year earlier.
New-home sales fell last month in the Northeast, Midwest and South but rose briskly in the West.
Other signs point to choppiness in the housing market. Existing-home sales-which reflect about 90% of the market-fell to a six-month low in November to a seasonally adjusted annual rate of 4.93 million, the National Association of Realtors said this week.
News Corp, owner of The Wall Street Journal, also owns Move Inc., which operates a website and mobile products for the National Association of Realtors.
A copy of the full report is available at: http://www.census.gov/construction/nrs.
Write to Josh Mitchell at email@example.com and Eric Morath at firstname.lastname@example.org.
(END) Dow Jones Newswires
December 23, 2014 10:00 ET (15:00 GMT)
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