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Winter Socks It to New Home Sales in December

Sales of new U.S. single-family homes fell more than expected in December, but lean inventories and steady price gains suggested sufficient strength in the housing market to support the economy.

The Commerce Department said on Monday sales fell 7.0 percent to a seasonally adjusted annual rate of 414,000 units. November's sales were revised to a 445,000-unit pace from the previously reported 464,000-unit rate.

Economists polled by Reuters had expected new home sales, which are measured when contracts are signed, to slow to a 457,000-unit pace in December.

The second straight month of declines in sales was likely payback after October's outsized 14.9 percent increase and may have reflected some drag from cold weather that blanketed most parts of the country last month.

Sales in the Northeast, which was hard hit by frigid temperatures, tumbled 36.4 percent to their slowest pace since June 2012. Home sales are traditionally weak during the winter, and last month's cold snap could have exaggerated the magnitude of the slowdown.