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US house prices hit new highs

NEW US single-family home sales held near two-year highs in August and prices vaulted to their highest level in more than five years, adding to signs of a broadening housing market recovery.

The Commerce Department said on Wednesday sales slipped 0.3pc to a seasonally adjusted 373,000-unit annual rate.

July's sales pace was revised up to a 374,000-unit pace, the highest level since April 2010, from the previously reported 372,000 units.

Economists polled by Reuters had forecast sales at a 380,000-unit rate last month. Compared to August last year, new home sales were up 27.7pc.

Last month, the median price of a new home increased a record 11.2pc to $256,900 -- the highest level since March 2007.

Compared to August last year, the median sales price jumped 17pc, the largest rise since December 2004.

"The drum beats louder ... more evidence that a recovery in U.S. housing is taking root," said Robert Kavcic, an economist at BMO Capital Markets in Toronto.

U.S. financial markets were little moved by the data, with stocks holding steady at lower levels.

Treasury debt prices maintained earlier gains and the dollar held firm against the euro.

Despite the month-on-month dip in sales, the report was consistent with other data that have suggested a turn-around in the housing market after collapsing in 2006 and igniting the 2007-09 recession.