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WASHINGTON (MarketWatch) - Sales of new single-family homes fell in December, but the whole of 2013 saw the highest sales level in five years, the government reported Monday.
Sales of new single-family homes dropped 7% in December to a seasonally adjusted annual rate of 414,000, the U.S. Commerce Department reported .
Economists polled by MarketWatch had expected a December home-sales rate of 455,000, down from an originally estimated November rate of 464,000, with particularly cold weather taking a bite out of results. On Monday, the government revised November's rate to 445,000.
U.S. stocks lost some momentum after the report's release. See MarketWatch's stock-market live blog.
December's numbers represent a 4.5% increase from a year earlier and for all of 2013, new-home sales hit 428,000, the most since 2008.
Despite the five-year high, activity remains far below a peak rate of almost 1.4 million in 2005.
The median price of new homes rose 0.6% in December to $270,200.
For 2013, the median price hit $265,800, up 8.4% from the prior year, the strongest annual growth since 2005. The supply of new homes on the U.S. market rose to 5 months in December at the current sales pace from 4.7 months in November.
After running higher in 2013, the pace of new-home sales may be cooling off with the housing market facing a variety of headwinds this year. Mortgage rates are expected to continue to rise, cutting some purchases, while other buyers will just scale back their plans. Also, there are new mortgage rules for lenders and borrowers.
Meanwhile, sufficient job growth, which ended 2013 on a weak note, is key to more home sales.
On a positive note for sales in 2014, banks may make it easier to obtain a home loan. Refinancing applications plummeted in 2013 as mortgage rates rose, and lenders are hungry for home-loan revenue.
Monday's home-sales data echo other housing reports showing that the market continued to recover in 2013. Last week the National Association of Realtors reported that existing-home sales in 2013 hit the highest level in seven years.
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