LOS ANGELES (AP) â¿¿ Shares of U.S. homebuilders retreated Wednesday, weighed down by a report showing sales of new homes dipped slightly in August from the previous month.
Several of the stocks remain up by more than twofold so far this year, however, reflecting steady gains as demand for new homes has improved overall this year.
The Commerce Department reported that new-home sales edged down last month to a seasonally adjusted annual rate of 373,000. That amounts to dip of 0.3 percent from July's revised rate of 374,000.
Sales in August were up 27.7 percent from the pace a year earlier. Even with that gain, new-home sales remain well below the annual pace of 700,000 that economists consider healthy.
While sales slowed, the median price of a new home jumped 11.2 percent last month to $256,900 â¿¿ the biggest one-month gain on record.
In a research note Wednesday, Citigroup analyst Will Randow said he expects August's new home sales figures will be revised slightly higher next month, noting that figures are typically adjusted higher during periods when sales are increasing.
In addition, several major homebuilders have recently reported strong new home orders trends, which suggests improved sales of new homes in coming months. Some economists forecast new home sales will continue to increase next year as the housing recovery gains momentum.
Home sales have been bolstered by the lowest mortgage rates on record. Prices are also rising because of a decline in foreclosures and sales of other deeply discounted homes.
Still, high unemployment and an uncertain economy remain hurdles for many would-be homebuyers. And many who have stable jobs are unable to qualify for a mortgage or can't afford larger down payments.
M/I Homes Inc. led the sector decline, falling $1.33, or 6.3 percent, to $19.72 in afternoon trading.
D.R. Horton Inc. slipped 57 cents, or 2.6 percent, to $21.17; Lennar Corp. fell $1.25, or 3.5 percent, to $35.01; KB Home dipped 50 cents, or 3.5 percent, to $13.91; Toll Brothers Inc. wad down 97 cents, or 2.7 percent, to $34.52; Beazer Homes USA Inc. fell 12 cents, or 3.3 percent, to $3.52; and, Hovnanian Enterprises Inc. slipped 13 cents, or 3.4 percent, to $3.50.