Business

New home sales at highest in 2 years

New home construction in Miami. Sales have risen 27.1 percent in the past year.
Joe Raedle/Getty Images
New home construction in Miami. Sales have risen 27.1 percent in the past year.

WASHINGTON — US sales of new homes jumped last month to the highest level in more than two years, further evidence of a sustained housing recovery that could help lift the lackluster economy.

The Commerce Department said Wednesday that new home sales rose 5.7 percent in September to a seasonally adjusted annual rate of 389,000. That’s up from a rate of 368,000 in August and the highest rate since April 2010, when a federal home buyer tax credit inflated sales.

Sales have risen 27.1 percent in the past year. That’s the strongest yearly gain since February, although sales are still well below healthy levels.

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The figures suggest the housing recovery is strengthening. The increase follows other reports that show home prices are rising more consistently, builders are starting to build more homes, and sales of previously occupied homes are up in the past year.

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Faster construction could help boost economic growth and hiring.

For now, rising sales are keeping inventories low. There were 145,000 new homes for sale at the end of September, near the record low of 143,000.

That level of inventory would be exhausted in 4.5 months at the current sales pace, the lowest level since October 2005.