According to the Commerce Department this morning, September sales of new homes dropped by 3.6%. September’s annual rate was 402,000 units, which was below the expected 440,000 annual units.

The average price for a new home was also lower, falling 9.1 percent on a year-over-year basis to $204,800. On the bright side, that is up 2.5 percent from August.

The housing market has been rebounding a bit lately, but things could turn around quickly should the current $8,000 tax incentive expire at the end of next month. It has been given credit for helping boost sales, but analysts are worried what will happen if Congress does not extend the program.