New Home Sales Jump Most in 33 Years in U.S.

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Sales of new single-family homes jumped 25 percent in October, its largest increase in more than 33 years, according to the Census Bureau. 

New home sales increased to a seasonally adjusted annual rate of 444,000 in October, from the revised September rate of 354,000, reaching a six-month high. The number of homes sold was 21.6 percent higher than last year, proving further evidence of growth in the housing market. 

"It may very well be that a lot of folks are feeling better about their prospects and buying a new home," Keith Gumbinger, vice president of mortgage information site HSH Associates, told CNN.  

The increase in new home sales suggests healthy activity in the housing market despite increasing home prices and mortgage rates.  

The strong new home sales dropped the supply of new homes to 183,000 in October, representing a 4.9-month supply at the current sales rate. This is down from the 6.4-month supply in September.  

Despite the decrease in supply, the median sales price dropped 0.6 percent from last year to $245,800.