Sales of US new homes soar in August

WASHINGTON (AP) — U.S. sales of new homes surged in August, led by a wave of buying in the West and Northeast.

The Commerce Department said today that new-home sales climbed 18 percent last month to a seasonally adjusted annual rate of 504,000. The report also revised up the July sales rate to 427,000 from 412,000.

Newly constructed homes sold at the fastest clip since May 2008. It's a clear sign of improvement for a real estate market that has been muddled in recent months, as the rebound in sales following the housing bust began to slow.

Sales of new homes are up 33 percent over the past 12 months. Median prices for new homes have risen nearly 8 percent during the same period to $275,600.

"All is not perfect in the housing market but things are certainly better today than they were about one year ago," said Dan Greenhaus, chief strategist at BTIG brokerage.

In the West, August purchases of new homes soared 50 percent compared to the prior month. Off the sharp August increase, sales in the West have nearly doubled in the past 12 months.