The cooler weather of autumn is matching the ongoing chill in the U.S. housing market.

New-home sales dropped 8.3 percent in August to a seasonally adjusted annual rate 795,000 homes, the lowest level in seven years, according to the latest figures from the U.S. Department of Commerce. That number is significantly lower than the 830,000 expected by many economists, reports the National Association of Home Builders. It’s also a 21.2 percent slide from August 2006, when the seasonally adjusted annual rate was 1,009,000 units.

Sales of existing homes also fell in August, coinciding with a rise in mortgage availability, says the National Association of Realtors. Existing homes, which include single-family, town homes, condo, and co-ops, dropped 4.3 percent from July to a seasonally adjusted annual rate of 5.50 million units in August from 5.75 million in July. The plunge from the August 2006 rate of 6.31 million homes is a sharp 12.8 percent.

Existing-home sales fell throughout the country compared with a year earlier, as did the median price of a home in two regions:
• West: 21.7 percent decline in sales and a 3.8 percent drop in price.
• South: 12.7 percent sales decrease and a 0.7 percent price slide in price.
• Midwest: 10.5 percent fall in sales but a 3.1 percent gain in price.
• Northeast: 5.7 percent sales reduction but a 3.6 percent rise in price.

“The unusual disruptions in the mortgage market, including a significant rise in jumbo-loan rates, resulted in a fairly high number of postponed or cancelled sales, with many buyers having to search for other financing when loan commitments fell through,” said Lawrence Yun, senior economist for the NAR. “Lower sales contributed to a buildup of unsold inventory.”—Helen A.S. Popkin

Essential information: Read “How to sell your home in a down market” for advice on increasing the odds that you'll find a buyer for you house.