Sales of new homes unexpectedly rose in August to the second-highest level on record as higher mortgage rates failed to discourage buyers, government figures showed.

New single-family home sales rose 2.9% in the month, to 983,000 units at a seasonally adjusted annual rate, the Commerce Department said. Sales in July rose 0.8%, to a rate of 955,000, previously reported as a 980,000 rate. August's pace was exceeded only by November's record annual rate of 985,000.

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