U.S. New Home Sales Rise to Highest Level Since February 2008
March 24, 2015 |
WASHINGTON—New-home sales rose to the highest level in seven years in February, a sign of strong demand that could help boost the broader U.S. housing market.
Sales of newly built, single-family homes increased 7.8% from a month earlier to a seasonally adjusted annual rate of 539,000, the Commerce Department said Tuesday. That is the highest level since February 2008.
Economists surveyed by The Wall Street Journal had expected sales to slide to a pace of 460,000.
Figures for the prior month were revised up to a rate of 500,000 from an initial estimate of 481,000. Sales haven’t consistently registered above 500,000 since the spring of 2008.
New-home sales represent about one-tenth of the overall housing market, and monthly figures are frequently revised. February’s advance estimate came with a margin of error of plus or minus 15.2 percentage points.
Broader trends point to a constrained housing market despite low interest rates, solid job creation and healthy consumer confidence.
Sales of existing homes, which account for roughly 90% of all purchases in the U.S., increased 1.2% last month to a seasonally adjusted annual rate of 4.88 million, the National Association of Realtors said on Monday. While a slight improvement from the prior month, rising prices and tight supplies appear to be holding back that market.
The arrival of more new homes on the market could help overcome those obstacles.
News Corp, owner of The Wall Street Journal, also owns Move Inc., which operates a website and mobile products for the NAR.
Tuesday’s data showed bad weather didn’t appear to hold back buyers last month. In the Northeast, sales of newly built, single-family homes rose sharply to an annual rate of 43,000. Sales also increased in the South, but declined in the Midwest and West.
Nationwide, sales were up 24.8% from a year earlier.
Meanwhile, new-home inventories tightened. At February’s pace, it would take 4.7 months to exhaust the supply of newly built homes on the market.
The median price of a newly built home stood at $275,500 in February, up 2.6% from a year earlier.
A copy of the full report is available at: http://www.census.gov/construction/nrs.
Source: “U.S. New Home Sales Reach Highest Level in Seven Years,” Jeffrey Sparshott and Josh Mitchell, Wall Street Journal (March 2015)