Sales of new homes remained weak in October, the latest sign the housing market is struggling to recover without government support for buyers.
The Commerce Department said Wednesday that sales of newly constructed dwellings stood at a seasonally adjusted annual rate of 283,000 units in October, down 8.1% from September and 28.5% below the October 2009 level.
The market for new homes has been weak since a tax credit for buyers expired in April.
Paul Dales, U.S. economist for Capital Economics, said the numbers were "close to awful."
"The inevitable result of weak demand and high supply will be even lower prices," Dales said. "We think that by the end of next year prices will be about 5% below current levels. That's unlikely to derail the economic recovery, but it will certainly hold it back."
The median new home sales price last month was $194,900, a 12.9% drop from September and an 8.2% decline from October 2009.