New single-family home sales increased 8.8% to a 693,000 annual pace last month, the fastest since September, government data showed Tuesday. Economists surveyed by Bloomberg gave a median estimate of 668,000.

The figures indicate that sales have somewhat stabilized in recent months, though the data are volatile. Underlying demand remains strong, but buyers are still constrained by high mortgage rates and prices, which are limiting the extent to which the housing market can gain momentum.

READ ALSO: RE/MAX's new president defines the new commissions landscape

Inflation has proved stubborn in recent months, calling into question not only when the Federal Reserve will cut interest rates in 2024, but if it will at all. Mortgage rates above 7% continue to plague existing-home sales, which are "stuck," National Association of Realtors Chief Economist Lawrence Yun said last week.

While the resale market is struggling with a lack of inventory, builders are stepping in to fill the void. The supply of new homes for purchase rose to 477,000 in the month, the highest since 2008.

The report from the Commerce Department on Tuesday also showed the median sales price of a new house decreased 1.9% from a year ago to $430,700 in March.