House Prices

Americans bought far fewer new homes last month, according to government data released on Wednesday that showed sales fell at the fastest rate in 13 years. | House prices also eased as the median cost of a new home fell 2.1 per cent from a year ago to $239,800. | Stephen Stanley, chief economist at RBS Greenwich Capital, said: "Builders will probably have to continue to work off bloated stocks of finished homes for most of 2007." | The biggest drop was in the west, where sales fell 37 per cent to an annual rate of 166,000. | The pace of sales fell to 937,000 from a rate of 1.1m the previous month, while inventories of unsold homes stood at 537,000. | However, the Federal Reserve views the overhang of unsold homes as a cause for concern but remains cautiously optimistic the sector is stabilising and will not derail the economy.