New Home Sales Jump But Prices Fall In April

Sales of new U.S. homes rose 16.2 percent in April, the sharpest climb in fourteen years, while prices fell a record 11 percent, according to a government report on Thursday that showed home builders taking extraordinary steps to move houses.

"You have to take this number as an outlier," said CNBC's Senior Economics Reporter Steve Liesman. "You cannot think that we are back to the good old days when it comes to housing."

New single-family home sales rose to an annual rate of 981,000 units from a revised rate of 844,000 in March, the Commerce Department said.

Analysts polled by Reuters were expecting April sales to rise to an 860,000 unit pace from a previously reported rate of 858,000 units in March.

In April, the median sales price of a new home fell $28,500 to $229,100 from $257,600 in March.

There were 538,000 new homes for sale in April, a fall from the 546,000 reported in March. It would take 6.5 months to clear that inventory at the current sales pace, less than the 8.1 months recorded in March.

In related news Thursday, homebuilder Toll Brothers

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[TOL  Loading...      ()   ] said its fiscal second-quarter profit fell sharply from the same quarter a year ago -- as it warned earlier in the month -- and the company said it was still uncomfortable giving profit guidance in the face of the contracting housing market.

Thursday's data comes a day ahead of another key report that measures the pace of existing home sales -- which represent 85 percent of the housing market.

Analysts polled by Reuters are expecting April existing home sales to rise to 6.14 million unit pace from the 6.12 million in March when that data is released Friday.

Sales were mostly up across the regions, with the South recording the largest gain at 27.8 percent. The Midwest saw a decline of 4.0 percent while the Northeast was up 3.8 percent and the West was up 8.5 percent.