Sales of new homes rose 1% in July to annual rate of 708,000

Sales of new homes posted a modest 1% increase in July after three months of declines

Sales of new homes rose a modest 1% in July after three months of declines.

The July sales increase left sales at a seasonally adjusted annual rate of 708,000, the Commerce Department reported Tuesday. Sales had fallen in April, May and June.

Home prices have soared over the past year, pushing some prospective home owners out of the market.

The median price of a new home sold in July was $390,500, up 18.4% from a year ago.

Home sales started the year at a sizzling pace as would-be buyers were confronted with a shortage of homes on the market and surging prices. Those factors have slowed the sales pace in recent months.

The National Association of Realtors reported Monday that sales of existing homes rose 2% in July compared to June to a seasonally adjusted annual rate of 5.99 million units.