September new-home sales rise 2.7% - East Valley Tribune: Business

September new-home sales rise 2.7%

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Posted: Monday, October 27, 2008 8:58 pm | Updated: 9:33 pm, Fri Oct 7, 2011.

Sales of new homes unexpectedly rose last month, as many homebuyers seized on builder discounts and rushed to take advantage of expiring down-payment assistance programs and other incentives.

Economists expected sales of new, single-family homes to drop from August levels, but instead they rose 2.7 percent in September to a seasonally adjusted annual rate of 464,000 homes, the Commerce Department reported Monday.

Many homebuilders had ramped up incentives in August and September to capitalize on the end of seller-funded down-payment assistance programs on Oct. 1. Builders also likely benefited from another factor: an increase from 3 percent to 3.5 percent in the down payment required to qualify for a Federal Housing Administration-insured loan, which also took effect Oct. 1.

Builders’ discounts helped push down the median price of a new home to $218,400, or 9.1 percent below what it was a year ago. That means prices have rolled back to what they were four years ago.

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