(Bloomberg) — New-home sales in the US bounced back to the highest level since May 2023 as buyers took advantage of lower mortgage rates and more listings to choose from.

Contract signings on new single-family homes increased 10.6% last month to a 739,000 annual rate, reflecting gains in all four major regions, government data Friday showed. The pace beat all estimates in a Bloomberg survey of economists.

The pickup in sales suggests the combination of lower mortgage rates and generous sales incentives by builders is starting to take root. Prospective buyers are finding more options in the new-home market as the supply of existing homes is still very constrained. Asking prices are also more competitive compared to the resale market.