Hot US new homes market sees biggest jump in 25 years

New US home sales saw their largest monthly increase in more than 25 years in November, with buyers in the fire-stricken West snatching up new houses at a rapid rate, according to government data released Friday.

The increase pushed the volume of sales to a fresh 10-year record, putting the pace at its fastest since before the US housing crisis erupted.

The hot market also meant the supply of homes for sale shrank markedly, with biggest monthly drop in 21 years, the Commerce Department reported.

Despite the tightening market, prices cooled for the second month in a row.

Sales of new homes soared 17.5 percent compared to October, reaching an annual rate of 733,000 units, seasonally adjusted -- the largest monthly increase since January 1992 and the fastest sales pace since July 2007.

The gain far outstripped analyst expectations, which called for a rate of 652,000 units.

Last month's increase appeared larger after a downward revision to October, which had originally been reported as a 10-year record.

Still, the month's figures were a stunning 26.6 percent higher than November 2016

In the fire-stricken western United States, new home sales soared 31.1 percent to an annual rate of 194,000 units, the biggest monthly gain since January 2013 and the fastest pace since July 2007.

The storm-hit southern United States added 14.9 percent, the biggest monthly increase since June 2007.

Gains also were reported in all other regions of the country, but were more modest.

Meanwhile, the median home price fell 0.3 percent to $318,700 while the average sank 4.5 percent to $377,100, the largest decline since April of this year.

The stock of new homes for sale on the market was unchanged at 283,000 but the brisk sales pace meant this represented a supply of only 4.6 months, down 14.8 percent -- the largest monthly decrease since February 1996.