Sales of new homes rose 2.8 percent in November, rebounding after an October plunge to levels not seen since the last recession, the government said. Despite the gain, however, the sales pace remained weak.
Sales totaled a seasonally adjusted annual rate of 506,000, approaching the 507,000 rate posted in September, the departments of Commerce and Housing and Urban Development said in a joint report.October sales had fallen a revised 3.0 percent, to 492,000 units, a bit better than the 3.5 percent decline first reported last month. That had been the lowest level since 480,000 units were purchased in October 1982, a month before the end of the last recession.
Sales have fallen during eight of the 11 months of 1990 and the November gain was the first advance since last June.
Nevertheless, sales during the first 11 months of 1990 were 16.6 percent below those of the same period of 1989. Sales totaled 676,000 in 1988.
At the November pace, it would take 7.8 months to exhaust the inventory of unsold homes down from 8.3 months in both September and October.
The housing industry has been in a slump for about two years and weak new home sales portend further sluggishness as builders tend to postpone plans.
The Commerce Department reported Wednesday that overall construction spending in November fell 0.6 percent to its lowest level in two years. The decline wiped out the October increase, the first gain in building activity in six months.
The construction industry lost 62,000 jobs last month, according to Labor Department statistics. Over the past six months, the industry has seen jobs tumble by about 250,000, the government said.
The median price of a new home in November rose 1.2 percent to $121,500. The median price means half of the homes cost more, half less.
The National Association of Realtors reported earlier that sales of existing homes in November rose 3.0 percent, to a seasonally adjusted annual rate of 3.14 million units, following declines of 3.8 percent in October and 9.4 percent in September.
The median existing home price in November was $91,300, the association said.
The South posted the only regional decline in new home sales, off 0.9 percent to 221,000 units.
Sales rose 7.7 percent to 84,000 homes in the Midwest, 7.1 percent to 120,000 units in the West and 1.3 percent to 81,000 in the Northeast.