US New Home Sales Hit Fastest Pace Since 2008

US sales of new homes rebounded in January to the fastest pace in more than five years, offering hopes that housing could be regaining momentum after a slowdown last year caused by rising interest rates. The Commerce Department says sales of new homes increased 9.6% in January to a seasonally adjusted annual rate of 468,000. That was the fastest pace since July 2008.

It came as a surprise to economists who had been forecasting a sales drop in January, in part because of a belief that activity would be held back by bad winter storms in many parts of the country. Sales had fallen 3.8% in December and 1.8% in November, leading to worries that the housing recovery could be losing momentum. (More housing market stories.)