Outside of housing, the economy looked somewhat brighter as business activity expanded in the U.S. Midwest and in New York City in December, separate reports showed.
The National Association of Purchasing Management-Chicago's business barometer rose to 56.6, its strongest since June, from 52.9 in November. Economists had forecast a reading of 51.8. Anything above 50 indicates expansion.
The National Association of Purchasing Management-New York's index rose to 449.1 in December from 445.0 in November, rising for a third straight month.
The report on Midwest business activity, in particular, helped ease concerns raised by a report on Thursday that showed weak orders for U.S.-made durable goods in November.
Analysts said it suggested the heartland's many export-related businesses are getting a boost from the weak U.S. dollar, even as domestic demand weakens.
"You can say that the manufacturing sector is not falling off the cliff, and although we are seeing a slowdown (in the overall economy) at least the industrial side is going to keep supporting the economy," said Kurt Brunner, portfolio manager at Swarthmore Group in Philadelphia.