New-home sales rose modestly in October, government statistics indicate.
According to the Commerce Department, sales of newly built, single-family homes grew 1.3 percent last month, totaling 307,000 units on a seasonally adjusted basis. Year-over-year, home sales were nearly 9 percent ahead of the pace of new-home sales in October 2010, which amounted to 282,000.
The gain marks the best pace of new-home sales in the U.S. since May, but historically speaking, home purchases are still quite low, as noted by National Association of Home Builders chairman Bob Nielsen.
"While this trend is encouraging, overall sales activity is still well below normal due to the effects of overly tight credit conditions for builders and buyers, the continued flow of distressed properties on the market, and inaccurate appraisal values on new homes," said Nielsen.
Due to restrictive lending policies, it may be in home buyers' best interest to review their financial histories and look for any inaccurate marks that may be unfairly lowering their credit scores. Borrowers are more likely to be approved for a mortgage if their credit scores are high.