Home sales, factory orders decline

WASHINGTON — Weekly jobless claims surged to the highest level in seven years, durable goods orders took a bigger-than-expected tumble and new home sales plunged to the slowest pace in 17 years, according to government data released Thursday.

The latest trifecta of bad news about the economy raised new worries about a possible recession and underscored the concerns that are driving Congress and the White House to reach agreement on an historic bailout of the financial system.

The Labor Department reported that jobless claims jumped by 32,000 to a seasonally adjusted 493,000 last week, the highest level since shortly after the Sept. 11, 2001 terrorist attacks and far above what economists had been expecting.

Labor Department analysts said that Hurricanes Ike and Gustav added about 50,000 claims, but even discounting the adverse impact from job disruptions in Louisiana and Texas, the four-week average for claims rose to 445,000, the highest it has been since November 2001, the month the last recession ended.

In a second report, the Commerce Department said that new orders to factories for big-ticket manufactured goods fell by 4.5 percent last month, led by a big drop in demand for airplanes but also reflecting weakness in everything from autos to primary metals and machinery.

The third weaker-than-expected report showed that new home sales plunged by 11.5 percent in August, a much bigger decline than the 1 percent dip that had been expected. It pushed sales down to a seasonally adjusted annual rate of 460,000, the slowest pace since January 1991.

The average price of a new home fell in August by 11.8 percent to $263,900, the biggest one-month drop on record. The median home price was down 5.5 percent to $221,900.

However, sales of existing homes in the West climbed higher in August versus a year ago, bucking a national trend as buyers snatched up sharply discounted foreclosed properties in California, Arizona and Nevada, according to two reports Wednesday.

About 106,000 existing homes and condos were sold last month in the 13-state region. Without adjusting for seasonal factors, that number is up about 1 percent from the same month last year and flat versus July's figures, according to the National Association of Realtors.Four metropolitan areas — Los Angeles, San Francisco, San Diego and Phoenix — were among the top five markets with the steepest median home price declines in the nation last month, according to The Associated Press-Re/Max Monthly Housing Report, released Wednesday. The data includes all home sales recorded by all local agents, regardless of company affiliation.

Seattle and Portland, Ore., meanwhile, were among the top 10 metros in the nation with the most pronounced drop in home sales.

The median price in the West slumped by almost 24 percent from a year ago to $251,600, the association said.

Nationally, existing home sales declined 15 percent from August last year, on an unadjusted basis, and the median price tumbled 9.5 percent to $203,100.

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