New Home Sales in U.S. Reach Highest Level in Ten Years

Sales of new, single-family U.S. homes reached their highest level in ten years due to an increase in housing demand across the country.

The Commerce Department released a report Monday stating that home sales rose 6.2 percent, the highest increase since October 2007, according to Bloomberg Markets.

The report attributes the increase in property values and demand for real estate to a steady job market and low mortgage costs.

But economists did not predict that housing sales would increase in the latest Commerce Department report.

Reuters polled several economists who originally predicted that new home sales, which comprise 11 percent of all home sales, would decline by six percent last month.

Instead, new home sales have continued to increase for three months straight.

The average selling point for new homes in October reached a record high $400,200, which suggests that most newly-constructed homes that are selling are for high-end buyers.

While new homes account for ten percent of the market, seven percent of all sales last month consisted of homes priced at $750,000 or more.

The majority of these new home sales are taking place in the northeastern U.S.—new home sales increased by 30.2 percent to their highest level since October 2007 in the Northeast, according to the Commerce Department report.

The South also showed a 1.3 percent increase in sales, bringing home sales in that area to a ten-year high.

The West showed a 6.4 percent increase in sales and home sales in the Midwest surged 17.9 percent over the past month, according to the report.