(fxcue news) - After reporting a substantial increase by new home sales in the U.S. in the previous month, the Commerce Department released a report on Wednesday showing new home sales pulled back sharply in the month of August. The Commerce Department said new home sales plunged by 4.7 percent to an annual rate of 716,000 in August after soaring by 10.3 percent to a revised rate of 751,000 in July. Economists had expected new home sales to tumble by 5.3 percent to a rate of 700,000 from the 739,000 originally reported for the previous month. The upwardly revised rate for July was the highest since new home sales hit an annual rate of 781,000 in February 2022. The report showed steep drops in new home sales in the Northeast and West, where new home sales plummeted by 27.3 percent and 17.8 percent, respectively. New home sales in the Midwest also dove by 5.8 percent, while new home sales in the South jumped by 2.7 percent. The Commerce Department also said the median sales price of new houses sold in August was $420,600, down 2.0 percent from $429,000 in July and down 4.6 percent from $440,900 a year ago. The estimate of new houses for sale at the end of August was 467,000, which represents 7.8 months of supply at the current sales rate. The months of supply is up from 7.3 in July but down from 7.9 in August 2023. Last Thursday, the National Association of Realtors released a separate report showing a sharp pullback by U.S. existing home sales in the month of August. NAR said existing home sales tumbled by 2.5 percent to an annual rate of 3.86 million in August after jumping by 1.3 percent to an annual rate of 3.95 million in July. Economists had expected existing home sales to slump by 1.3 percent to a rate of 3.90 million. With the bigger than expected decrease, existing home sales fell to their lowest level since hitting an annual rate of 3.85 million last October.