New-Home Sales Fall

Sales of new single-family homes fell 2.9% in July from a record level in June as the housing market continued to operate at a frenzied pace.The U.S. Commerce Department reported that new-home sales fell from a seasonally adjusted annual rate of 1.20 million in June to 1.16 million in July. The pace of home sales this summer is "clearly unsustainable -- it is clearly a frenzy," said Jade Zelnik, chief economist for RBS Greenwich Capital. She is looking for the housing market to cool in the coming months, with new-home sales dipping below the one million pace. "But it still should be extremely healthy," Ms. Zelnik said. The economist noted that consumers still view mortgage rates as low and the economic recovery is broadening. Jobs and income growth should have "a mitigating impact to the higher cost of borrowing," she said. The Commerce Department can be found online at http://www.doc.gov.