Business

US new home sales fall again in July

New homes for sale in Davie, Florida
Image caption New-home sales make up one-fifth of US housing transactions

US new home sales fell for the third month a row in July, figures have shown, indicating continuing weakness in the housing market.

Sales fell 0.7% in July to a seasonally adjusted annual rate of 298,000, from a downwardly revised 300,000 in June, the Commerce Department said.

The new figures, which were worse than analysts had expected, represent a five-month low.

High unemployment and a weak house market are undermining the US recovery.

An oversupply of used homes and a large stock of foreclosed housing is also putting a strain on the market.

"Not only is the decline of 0.7% larger than expected, but June revisions, down to 300k, make forecast consensus of a dip to 310k from 312k look misplaced," said Vmombi Nshom of IFR Economics.

New homes represent less than one-fifth of the housing market, but have a large impact on the economy.

According to the National Association of Home Builders each new-build creates an average of three jobs and $90,000 in taxes.

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