U.S. Sales of New Homes Slipped 1.5 Percent in April

Sales of new U.S. homes fell 1.5 percent in April as buying plunged in the West.

The Commerce Department said Wednesday that new homes sold last month at a seasonally adjusted annual rate of 662,000. So far this year, new home sales are 8.4 percent higher than in 2017.

A solid job market and a shortage of existing homes for sale have led more people into the new home market, even though they are generally more expensive than existing homes. Sales last month were increasingly made at the higher end.

Momentum in the U.S. housing market has overcome even a supply shortage because mortgage rates remain near historic lows. But average mortgage rates have begun to climb, reaching a seven-year high of 4.61 percent on a 30-year loan, according to mortgage buyer Freddie Mac.

Sales tumbled 7.9 percent last month in the West and were essentially unchanged in the Midwest and South. But sales improved 11.1 percent in the Northeast. The new-home sales figures are often volatile on a monthly basis and often revised.

The median sales price of a new home rose 0.4 percent from a year ago, to $312,400. But that masks a broader change last month, which was more activity at luxury prices levels.

Ten percent of new homes purchased in April cost more than $750,000. That is twice the percentage of homes bought last year in that range. As a result, the average price of a new home in April shot up 11.3 percent from a year ago, to $407,300.