New home sales pick up pace in August

There has been growing concern within the housing industry that the quick rise in mortgage rates — they are up a full percentage point since May to their highest level in two years on 30-year fixed loans — could hamper sales. 

Rates have been floating around 4.5 percent.

{mosads}Still, on the flip side, many economists say that mortgage rates are hovering near historic lows and should not be a set back to the steady recovery.

Home builders remain confident about the trajectory of the housing market amid those concerns, posting the highest home builder confidence in nearly eight years in August. 

Also, sales of existing homes hit its highest level in more than six years the National Association of Realtors reported last week. 

The median sales price of new houses sold in August was $254,600 and the average sales price was $318,900. 

The seasonally adjusted estimate of new houses for sale at the end of August was 175,000, representing a supply of five months at the current sales rate.

Regionally, sales were up in three of four areas — 19.6 percent in the Midwest, 15.3 percent in the South and 8.8 percent in the Northeast. 

Sales were down 14.6 percent in the West, the second straight month of double-digit drops as the region battles back from steep drops during the economic downturn.