WASHINGTON — New home sales unexpectedly fell 7.6 percent last month, capping the industry's weakest year on record.

December sales fell to a seasonally adjusted annual rate of 342,000 from an upwardly revised November pace of 370,000, the Commerce Department said today. Economists surveyed by Thomson Reuters had forecast a pace of 370,000 for December.

The results were the weakest since March and indicated demand remains sluggish despite newly expanded tax incentives to spur sales. The report is likely to fuel concern the housing market turnaround will falter when government support ends this spring.

By The Associated Press