A report released by the Commerce Department on Thursday unexpectedly showed another significant increase in new home sales in the U.S. in the month of August.
The Commerce Department said new home sales jumped by 4.8 percent to an annual rate of 1.011 million in August after skyrocketing by 14.7 percent to an upwardly revised rate of 965,000 in July.
Economists had expected new home sales to pull back by 1.2 percent to a rate of 890,000 from the 901,000 originally reported for the previous month.
With the unexpected increase, new home sales surged up to their highest level since reaching 1.016 million in September of 2006.
New home sales in the South spiked by 13.4 percent to an annual rate of 636,000, while new home sales in the Northeast jumped by 5.0 percent to a rate of 42,000.
On the other hand, the report said new home sales in the Midwest plunged by 21.4 percent to a rate of 99,000. New home sales in the West also slid 1.7 percent to a rate of 234,000.
The Commerce Department said the median sales price of new houses sold in August was $312,800, down 4.6 percent from $327,800 in July and down 4.3 percent from $327,000 a year ago.
The estimate of new houses for sale at the end of August was 282,000, representing 3.3 months of supply at the current sales rate. The months of supply is down from 3.6 in July.
“Strong sales have depleted inventories of new homes for sale, which fell to their lowest level in nearly three years,” said Nancy Vanden Houten, Lead U.S. Economist at Capital Economics.
She added, “That, along with strong homebuilder sentiment and lean inventories of existing homes, should support new home construction even if the pace of sales softens in the months ahead.”
On Tuesday, the National Association of Realtors released a separate report showing existing home sales also climbed to their highest level in nearly fourteen years in August.
NAR said existing home sales jumped 2.4 percent to an annual rate of 6.000 million in August after skyrocketing by 24.7 percent to a rate of 5.860 million in July.
With the continued increase, which matched economist estimates, existing home sales reached their highest level since December of 2006.
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