NEW HOME SALES SURGE IN U. S., ESPECIALLY IN SOUTH

Purchases of new U. S. homes jumped in July to the highest level in almost nine years, led by soaring demand in the South and adding to signs of housing-market strength. Sales increased 12.4 per cent to a 654,000 annualized pace, the fastest since October, 2007, Commerce Department data showed Tuesday. That exceeded the most optimistic forecast in a Bloomberg survey. Purchases in the South were the strongest since before the start of the last recession. Employment gains and low borrowing costs are providing support for housing demand, helping reduce inventory, which will probably keep new construction elevated. The report showed an increase in homes sold for less than US$300,000, indicating builders are turning their sights to entrylevel buyers.