New Home Sales Up 2.9%

Washington, DC, January 27, 2006–Sales of new U.S. homes increased a surprising 2.9% in December to a seasonally adjusted annual rate of 1.269 million, the Commerce Department reported Friday.

Economists were expecting sales to fall slightly to a 1.23 million rate.

The sales rate in November was revised lower to 1.233 million from 1.245 million previously. For all of 2005, new home sales rose 6.6% to a record 1.282 million.

The inventory of unsold homes increased 2.4% in December to a record 516,000, a 4.9-month supply at the December sales pace, matching the cyclical high set in November.

The median sales price fell 3.4% year-over-year to $221,800 in December. The median price for all of 2005 rose 7.4% to $237,300.