New Home Sales Plummet

New home sales fell 4% in August to their lowest level in five months, according to data released Wednesday by the U.S. Commerce Department.Government data show that new homes sold at a seasonally adjusted annual rate of 838,000 in August, compared with a revised 877,000 in July. This is the second consecutive monthly decline for new home sales and the lowest rate since March, when it stood at 836,000. Year over year, new home sales are up 5%. Paul Taylor, senior economist at America's Community Bankers, said new home sales could rebound in the coming months. "However, I think we may have peaked for the year in June when the rate was at 922,000." The median sales price of a new home was $151,000 in August, up from $144,000 a year ago. The Commerce Department said the nation's supply of new homes currently stands at 289,000, representing a 4.2-month supply.