Share this article

print logo

CONSUMER CONFIDENCE RISES; NEW-HOME SALES DECLINE

Consumer confidence edged higher in September, as low unemployment and inflation levels kept consumers upbeat about their financial outlook, according to a business research group's survey.

The Conference Board reported today that its index of consumer confidence rose to 128.6 this month from 127.6 in August.

In a second report today, new-home sales fell 2.2 percent in August, pulled down by declines in the West and Midwest.

Single-family homes sold at a seasonally adjusted annual rate of 800,000, down from 818,000 in July, the Commerce Department said. The decline was somewhat larger than expected.

The consumer confidence index is closely watched because consumer spending accounts for two-thirds of the nation's overall economic activity.

"With confidence stabilizing at levels not seen in nearly three decades, the economy should continue on a steady upward path," said Lynn Franco, associate director of the Conference Board's consumer research center.

The index, calculated from a 1985 base of 100, is derived from responses to questions sent to 5,000 households nationwide.

New-home sales had risen 0.4 percent in July and 6.7 percent in June. August marked the 20th consecutive month of sales above the 700,000 level, the longest such string since 1978-79.

During the first eight months of the year, sales are running 6 percent ahead of the same period of 1996.

New-home sales soared 15.6 percent in the Northeast to a seasonally adjusted annual rate of 74,000, a three-month high. In other regions, sales fell 12.6 percent in the West to 215,000. Sales fell 4.5 percent in the Midwest to a rate of 147,000. They rose 3.1 percent in the South to 364,000.

Nationally, the median price of a new home -- meaning half sold for more and half for less -- was $145,000 in August, down 0.6 percent from a month earlier but up 5.8 percent from a year ago.

There are no comments - be the first to comment