WASHINGTON -- The U.S. housing market turned sour in September as sales of new single-family homes tumbled despite the last few months' steady decline in mortgage interest rates, adding to evidence that the economy is losing momentum.

Sales of new homes fell 12.9% from 512,000 to 446,000, the Commerce Department reproted yesterday. That is the lowest level since January, when the economy was in the middle of the recession.

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