Markets & Economy

New-home sales skyrocket in October

Purchases up 21.6 percent from year ago

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Sales of new single-family homes skyrocketed in October, ending a three-month slump that began in July and providing evidence that elevated mortgage rates have not seriously hobbled the housing recovery. New-home sales leaped 25.4 percent from September to October to a seasonally adjusted annual rate of 444,000, according to data released today by the U.S. Census Bureau and the Department of Housing and Urban Development (HUD). On an annual basis, sales of new single-family homes increased by 21.6 percent. While the jump in mortgage rates that occurred last spring may have temporarily stymied home sales, any blow to the market was "entirely transitory," according to research firm Capital Economics. October's new home sales were about equal to those recorded between January and June of this year, despite the fact that average mortgage rates were 60 basis points higher in October. "To our minds, this lends further support to our view that higher mortgage interest rates wil...