WASHINGTON - Sales of new U.S. single-family homes fell more than expected in April likely as higher mortgage rates and prices squeeze out first-time buyers and those in search of entry-level properties from the housing market.

New home sales plunged 16.6% to a seasonally adjusted annual rate of 591,000 units last month, the Commerce Department said on Tuesday. March's sales pace was revised down to 709,000 units from the previously reported 763,000 units.

Economists polled by Reuters had forecast new home sales, which account for a small share of U.S. home sales, would fall to a rate of 750,000 units.

(Reporting by Lucia Mutikani; Editing by Chizu Nomiyama)