Washington, DC, United States (4E) – Sales of new homes dropped to its four-month low in July, an indication that the U.S. real estate sector has lost its momentum to help the economy grow faster.
New single-family houses saw their sales fall 2.4 percent in July from the previous month to a pace of 412,000 on a seasonally adjusted basis, according to the Commerce Department report released Monday. The figure is lower compared with economists’ lowest forecast, according to data compiled by Bloomberg News.
The drop is tempered by the results in the previous two months that were upwardly revised, though this year’s performance only matches the rate recorded in 2013.
Sales in June were revised upward to a pace of 422,000 after an increase in May that was more than previously thought.
Newly built houses account for just around 10 percent of the country’s home-buying activity, but they are a key gauge for the overall economy because home building suggest that the economy provides well-paying, middle-class jobs.
Meanwhile, purchases of previously owned properties have increased for four consecutive months, according to the National Association of Realtors’ data. Combined sales of new and existing homes reached 5.56 million in July on an annualized basis, the fastest pace since last October.