New-Home Sales Fall

Sales of new single-family homes fell 6.4% in July from the level of the previous month, despite declining interest rates.The U.S. Census Bureau reported that new-home sales in July came in at a seasonally adjusted annual rate of 1.13 million, compared with 1.21 million in June. Such a large decline came as a surprise to economists at the National Association of Home Builders. "We were surprised that they had dropped like that," NAHB economist Michael Carliner told MortgageWire. "Most of the reports that we got from builders about July were pretty positive." Mr. Carliner is still optimistic about new-home sales for the month of August. "I think that the August number ought to be at least as high as the July number, which is still a very high number, and maybe a little higher," he said. However, "by the end of the year, we don't expect to see mortgage rates quite as favorable, and we don't expect to see sales as quite as strong," Mr. Carliner said.