New home sales declined 1.6% in July, to a seasonally adjusted rate of 886,000 units, the Commerce Department reported Monday.

The dip was expected, according to a representative from the National Association of Home Builders, especially following June's record sales rate of 900,000 units.

"New home sales remained quite strong," said the trade group's president, Don Martin. Sales have been essentially flat at a high level for four months, Mr. Martin noted. He said he expects the housing market to slow down later in the year.

The association is expecting sales of new single-family homes for the full year to total 870,000, up 7.8% from 1997's 804,000.

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