New home sales rise 6.2% in October

Sales of new homes rose a better-than-expected 6.2 percent in October, according to figures released this morning by the Commerce Department, fueled solely by a hot Southern market.

This puts the pace of new home sales at a 430,000 annualized rate. Forecasters were expecting a rate of 410,000.

The median sales price of a new home was $212,200, up 1 percent from September's price and down just a tick from the median price of a new home sold in September 2008, of $213,000.

These figures represent contracts signed, not closings, indicating buyers were rushing to take advantage of the first-time home-buyer credit before it was scheduled to expire at the end of this month. Congress, however, has extended it to the end of April.

The action came in the South, which had a 23 percent increase in new home sales. Everywhere else across the country in October, new home sales fell: down 5 percent in the West and Northeast and down 20 percent in the Midwest.

This should make economists wonder what a regional real estate recovery would mean to the overall economy.

-- Frank Ahrens
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