WASHINGTON (Reuters) -Sales of new U.S. single-family homes unexpectedly increased in April as builders lowered prices to lure buyers, but rising mortgage rates and an uncertain economic outlook remain constraints for the housing market.

New home sales surged 10.9% to a seasonally adjusted annual rate of 743,000 units last month, the Commerce Department's Census Bureau said on Friday.

The sales pace for March was revised down to a rate of 670,000 units from the previously reported 724,000 units.

Economists polled by Reuters had forecast new home sales, which make up about 14% of U.S. home sales, declining to a rate of 693,000 units.