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| Further fall in new US home sales | Further fall in new US home sales |
| (30 minutes later) | |
| Sales of new family homes in the US fell 8.3% in August to its slowest rate in more than seven years, a Commerce Department report has shown. | Sales of new family homes in the US fell 8.3% in August to its slowest rate in more than seven years, a Commerce Department report has shown. |
| New home sales fell to an annual pace of 795,000 - from July's 867,000 - worse than analysts had been expecting. | New home sales fell to an annual pace of 795,000 - from July's 867,000 - worse than analysts had been expecting. |
| The average sales price of a new home also fell 8.3%, to $225,700 (£111,500) - the lowest since January 2005. | The average sales price of a new home also fell 8.3%, to $225,700 (£111,500) - the lowest since January 2005. |
| Analysts say that such weak data will give the US Federal Reserve more reasons to cut interest rates again. | Analysts say that such weak data will give the US Federal Reserve more reasons to cut interest rates again. |
| The Commerce Department also said that there were 529,000 new homes for sale in August, a 1.5% drop from July. | The Commerce Department also said that there were 529,000 new homes for sale in August, a 1.5% drop from July. |
| It would take 8.2 months to sell those properties at the current sales pace, the department said, up from the 7.6 months reported in July. | It would take 8.2 months to sell those properties at the current sales pace, the department said, up from the 7.6 months reported in July. |
| Worries triggered | |
| Higher borrowing costs have hit the US housing market, unravelling the property boom. | |
| And increasing defaults on sub-prime mortgages - where loans have been granted to people on low incomes or with poor credit histories at higher than normal repayment levels - have triggered turmoil on the world's financial markets. | |
| Analysts say that tight credit conditions - making it harder for people to get mortgages - are continuing to dent the market for house sales, which is already weak. | Analysts say that tight credit conditions - making it harder for people to get mortgages - are continuing to dent the market for house sales, which is already weak. |
| The housing slowdown and decline in credit availability have triggered worries that the economy could go into a recession - a worry which was behind the Fed's move to cut interest rates from 5.25% to 4.75% earlier this month. | The housing slowdown and decline in credit availability have triggered worries that the economy could go into a recession - a worry which was behind the Fed's move to cut interest rates from 5.25% to 4.75% earlier this month. |
| Separately, the Commerce Department issued a revised figure for US economic growth between April and June. | |
| The economy grew at an annual rate of 3.8% in the quarter, it said, down from the previously published 4%. | |
| However, analysts said that because of the financial turmoil which had struck during the third quarter, the revision was not that significant. |