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US new home sales surge 5.7 percent in August to 7-year high

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WASHINGTON (AP) - Buoyed by steady job gains and low mortgage rates, Americans purchased new homes in August at the fastest pace in more than seven years.

The Commerce Department says new-home sales surged 5.7 percent last month to a seasonally adjusted annual rate of 552,000. That followed an even bigger 12 percent jump in July, according to the government's revised figures.

Healthy hiring and smaller price increases for new homes have finally begun pushing up sales, which were hammered during the Great Recession. New home sales have soared nearly 22 percent in the past year.

Strong gains in new home sales could accelerate the economy by boosting home building, which generates construction jobs, demand for more building materials and more spending on landscaping and other services.

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