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New Home Sales Hit Record High

June 29, 1998

WASHINGTON (AP) _ Sales of new homes edged up 0.3 percent to a record in May, propelled by strong demand in the West.

Sales hit a seasonally adjusted annual rate of 890,000 last month, the highest since the government began tracking them in 1963, the Commerce Department said today.

May marks the ninth consecutive month of sales at or above 800,000, the longest such streak in 21 years. For the first five months of the year, sales were 8.8 percent higher than the same period of last year.

Home sales _ both new and existing _ have been exceptionally strong this year, thanks to the lowest unemployment rates and close to the lowest mortgage interest rates in nearly 30 years.

Low mortgage rates make home payments more affordable, while a strong job market gives buyers the economic confidence they need to commit to a mortgage.

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