New-home sales increase in December

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Sales of newly built homes jumped 17.5% in December from November, the government said Wednesday.

New-home sales were at a seasonally adjusted annual rate of 329,000 units, a 7.6% drop from December 2009, the Commerce Department said. A total of 321,000 homes were built in 2010, the lowest level in 47 years, according to the Associated Press.

Sales of new homes face stiff competition from previously owned properties, in particular the large glut of foreclosures that has hit the market ever since the housing bubble burst.

The median sales price of new houses sold in December 2010 was $241,500. The seasonally adjusted estimate of new houses for sale at the end of December was 190,000, representing a supply of about seven months.

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-- Alejandro Lazo