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New Home Sales Rebound 2 Percent on Jump in West

Image: New Home Sales Rebound 2 Percent on Jump in West

Wednesday, 23 Mar 2016 10:22 AM

U.S. single-family home sales rebounded in February, but the gain was concentrated in one region, which could suggest a loss of momentum in the housing market.

The Commerce Department said on Wednesday home sales rose 2.0 percent to a seasonally adjusted annual rate of 512,000 units. January's sales pace was revised up to 502,000 units from the previously reported 494,000 units.

Sales, however, fell in three regions, taking some shine off the report. Economists polled by Reuters had forecast new home sales, which account for about 9.2 percent of the housing market, rising to a 510,000 unit-rate last month.

The report comes on the heels of data on Monday showing a 7.1 percent dive in sales of previously owned homes in February, which economists blamed on tight inventories and difficulties adjusting the data during the month with a leap day.

Economists also blamed February's weak sales on a drop in contract signings in January because of snow storms. Housing market fundamentals remain strong because of a strengthening labor market, which is boosting household formation, and historically low mortgage rates.

But the dearth of homes for sale, which is limiting options for buyers and pushing up prices, is a major challenge for the sector. In February, the inventory of new homes on the market rose 1.7 percent to 240,000 units, the highest since October 2009.

Still, housing stock remains less than half of what it was at the height of housing bubble.

At February's sales pace it would take 5.6 months to clear the supply of houses on the market, unchanged from January. The median price of a new home rose 2.6 percent from a year ago to $301,400.

New single-family homes sales in the West, which has seen a sharp increase in home prices amid tight inventories, surged 38.5 percent to a 151,000 unit-rate.

Sales, however, fell in the remaining three regions. They plunged 24.2 percent in the Northeast and tumbled 17.9 percent in the Midwest and dropped 4.1 percent in the populous South.

© 2017 Thomson/Reuters. All rights reserved.

   
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U.S. single-family home sales rebounded in February, but the gain was concentrated in one region, which could suggest a loss of momentum in the housing market.The Commerce Department said on Wednesday home sales rose 2.0 percent to a seasonally adjusted annual rate of...
new home, sales, housing, realtor
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2016-22-23
Wednesday, 23 Mar 2016 10:22 AM
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