The U.S. Commerce Department reported on Tuesday that the sales of new single-family homes rose 3.7 percent m-o-m to a seasonally adjusted annual rate of 621,000 units in December. That was the highest level since last May.

Economists had forecast a sales pace of 600,000 for December. 

November’s sales pace was revised down to 599,000 units from the originally reported 657,000 units. 

According to the report, new home sales in the South, the largest area, surged 5.0 percent m-o-m to a seven-month high in December. Sales in the West rose 1.4 percent m-o-m, while sales in the Northeast jumped 44.8 percent m-o-m. At the same time, new home sales fell 15.3 percent m-o-m in the Midwest to their lowest level since April 2016.