The pace of new single-family home sales last month outperformed even the most optimistic projections, according to government numbers released Wednesday. The Commerce Department reported new home sales in August were up 18 percent month-over-month to a seasonally adjusted annual rate of 504,000. Economists had projected a consensus sales pace of 430,000, with estimates ranging as high as 465,000. While new home sales estimates have seen large swings and revisions from month to month this year, market watchers still took the news as a hopeful sign for a struggling segment of the market.
Monthly gains were led by the West, where sales jumped a full 50 percent to an annualized pace of 153,000 in August. The Northeast also outperformed, posting a nearly 30 percent increase to 31,000. Activity was more subdued in the country’s other regions, rising 7.8 percent in the South and remaining flat in the Midwest.
After rising on the back of a double-digit jump in refinances, mortgage applications experienced another dive last week. The Mortgage Bankers Association reported a seasonally adjusted 4.1 percent decline in overall loan application volumes for the week ending September 19th, a step backward after the prior week’s nearly 8 percent bounce. Declines were recorded in both purchase loan applications, which were down 0.3 percent, and refinances, which fell 7 percent as interest rates hit a four-month high. With the latest decrease, the refinance share of total applications fell to 56 percent for the week.