US new-home sales fell in Dec., sales for year up

The Commerce Department said Friday that new-home sales fell 7.3 percent last month to a seasonally adjusted annual rate of 369,000. That's down from November's rate, which was the fastest in 2 ½ years.

For the year, sales rose nearly 20 percent to 367,000. That's the most since 2009 and the first annual gain since 2005, although that's coming off the worst year for new-home sales since the government began keeping records in 1963. Sales are still below the 700,000 level that economists consider healthy.

The housing market began to recovery last year, roughly five years after the housing bubble burst. Stable job gains and record-low mortgage rates encouraged more people to buy homes.

Sales of previously occupied homes rose to 4.65 million last year, the most in five years.

Home prices rose steadily and the gains appear to be sustainable. And builders finished their best year for residential construction since 2008.

The housing market has a long way back to a full recovery. But most economists expect the recovery will strengthen in 2013.