April 20, 2021

Sales of New Homes Rose 1.5% in March

WASHINGTON — Sales of new homes rose 1.5 percent in March to a seasonally adjusted annual rate of 417,000, adding to evidence of a sustained housing recovery at the start of the spring buying season.

The Commerce Department said on Tuesday that sales of new homes exceeded February’s pace of 411,000, though they were below January’s 445,000 — the fastest rate since July 2008.

New-home sales are still below the 700,000 pace considered healthy by most economists. But the rate has increased 18.5 percent from 352,000 a year ago.

Most economists see more gains ahead, as housing is likely to remain a consistent driver of economic growth this year.

“With increasing signs of a softer U.S. economy springing up in the spring, we can take comfort in the resilience of the housing recovery,” said Jennifer Lee, senior economist at BMO Capital Markets.

Steady job creation and near-record low mortgage rates are spurring more Americans to buy houses. The rise in demand is helping to raise sales and prices in most markets. Higher prices tend to make homeowners feel wealthier and encourage more spending.

A limited supply of both new and previously occupied homes has also helped lift prices.

The inventory of new homes for sale increased 2 percent in March, to 153,000, the second consecutive gain. Still, that’s the equivalent of a 4.4-month supply at the current sales pace and historically lean, according to Jim O’Sullivan, chief United States economist at High Frequency Economics.

The median price of a new home rose to $247,000 in March, 3 percent higher than a year ago.

The March sales gain came from a 20.6 percent increase in the Northeast and a 19.4 percent rise in the South. Sales fell 20.9 percent in the West, where problems of supply have hampered home buying. Sales were down 12.1 percent in the Midwest.

Sales of previously occupied homes dipped in March from February, according to the National Association of Realtors. Still, sales were 10.3 percent higher than a year earlier.

The association cited low supply as a reason sales fell in March. But in a positive sign, the inventory of previously occupied homes increased for the second straight month. That suggests more sellers are confident that the recovery will continue and they can sell at a good price.

Low inventories have helped drive more construction of new homes.

Home builders started work on more than one million new houses and apartments in March at a seasonally adjusted annual rate, the first time the number had crossed that threshold in nearly five years. That reflected a surge in volatile apartment building.

Single-family home construction fell in March after reaching the fastest rate in nearly five years.

Still, a low supply of homes for sale is just one of several constraints that could limit sales. Since the housing bubble burst more than six years ago, banks have imposed tighter credit conditions and required larger down payments. That has made it harder for first-time homebuyers to qualify for the low mortgage rates resulting from the Federal Reserve’s efforts to ease credit.

Article source: http://www.nytimes.com/2013/04/24/business/economy/sales-of-new-homes-rose-in-march.html?partner=rss&emc=rss

Stock Gains Ease After Lackluster U.S. Economic Data

LONDON (AP) — European markets closed higher Friday ahead of the Christmas break even though a batch of disappointing U.S. economic figures reined in some of the recent optimism over the state of the world’s largest economy.

Figures showing that consumer spending and personal income rose by a modest 0.1 percent in November were below market expectations, while the headline 3.8 percent increase in durable goods orders last month masked a decline in a crucial investment measure, benefiting from big orders for Boeing aircraft.

The figures offset some of the optimism in markets about the U.S. economy following a run of largely positive data. Since Thursday, investors have taken heart from figures showing that the number of initial jobless claims in the U.S. unexpectedly fell 4,000 last week to 364,000, the lowest level since April 2008.

Those figures had raised hopes that the U.S. economy got through its soft patch earlier this year and may be poised for stronger-than-anticipated growth in the fourth quarter.

“This doesn’t change the overall view too much but it is somewhat deflating,” said Jennifer Lee, an analyst at BMO Capital Markets.

That was evident in the markets, where stocks in Europe gave up many of their earlier gains and Wall Street opened lower than predicted in futures markets. Trading activity was muted as the traditional holiday slowdown began in earnest.

In Europe, Germany’s DAX closed 0.5 percent higher at 5,878.93 while the CAC-40 in France rose 1 percent to 3,102.09. The FTSE 100 index of leading British shares, which only traded for a half day, closed up 1 percent at 5,512.70.

In the U.S., the Dow Jones industrial average was up 0.6 percent at 12,246 while the broader Standard Poor’s 500 index rose the same rate to 1,262.

Trading was fairly lackluster in the currency markets too, with the euro down 0.1 percent at $1.3048 and the dollar 0.1 percent lower at 78.09 yen.

While the U.S. economy has been the dominant driver in markets the past couple of days, Europe’s debt crisis is likely to remain the key market focus next year.

There were reminders Friday of the underlying problems afflicting the 17-nation eurozone.

Figures showed that eurozone banks stashed euro347 billion ($453 billion) overnight with the European Central Bank on Thursday, in another sign that Europe’s debt crisis is still putting pressure on the banking system despite massive central bank support. The figure announced Friday is the highest for 2011, topping euro346.4 billion earlier this month.

The large deposits come despite Wednesday’s massive central bank credit operation, in which the ECB let banks borrow as much as they wanted for up to 3 years. As a result 523 banks took euro489 billion, the largest ECB loan operation in the 13-year history of the euro.

Earlier in Asia, China’s benchmark in Shanghai gained 0.9 percent to 2,204.78 and Hong Kong’s Hang Seng rose 1.4 percent to 18,629.17. Japan’s financial markets were closed for a public holiday.

Oil prices tracked equities higher — benchmark crude for February delivery was up 44 cents to $99.97 a barrel in electronic trading on the New York Mercantile Exchange.

____

Alex Kennedy in Singapore contributed to this report.

Article source: http://feeds.nytimes.com/click.phdo?i=8457b7a1b07008a1770d96042553df12

Home Sales Fall 0.8%; 3rd Drop in 3 Months

The National Association of Realtors said home sales fell 0.8 percent last month to a seasonally adjusted annual rate of 4.77 million homes. That is far below the six million homes a year rate that economists say represents a healthy housing market.

June’s decrease was the third consecutive monthly decline in home sales.

Through the first six months of 2011, the number of sales is behind last year’s 4.91 million homes sold — the weakest sales in 13 years. Sales have fallen in four of the last five years.

The association said a record number of people who signed contracts canceled their deals last month. And first-time buyers are becoming a smaller share of the market.

Sales of single-family homes held steady in June, while sales of condominiums declined 7 percent.

Bigger down payments, tougher lending rules, high debt and a shortage of desirable starter homes are deterring many would-be buyers. Even some people with good credit and enough money for a down payment are delaying because they are worried that prices will keep falling.

“It all goes back to uncertainty about the future and hiring,” said Jennifer Lee, senior economist at BMO Capital Markets.

First-time buyers made up just 31 percent of sales in June, when normally they make up about half of all home sales. First-time buyers are valuable in the housing market because they tend to keep their homes for years and because their purchases allow sellers to move to more expensive homes.

About 16 percent of home deals were canceled last month, four times the number in May and the highest level since such record keeping began more than a year ago. A sale is not final until a mortgage is closed.

The median sales price rose nearly 9 percent in June from May, to $184,300. The increase was mainly a result of seasonal factors that led to a big increase in prices in the Northeast and West.

Sales were uneven across the country. In May, sales rose 0.5 percent in the West and 1 percent in the Midwest and fell 1.7 percent in the South and 5.2 percent in the Northeast.

The supply of unsold homes rose slightly in June to 3.77 million. At last month’s sales pace, it would take 9.5 months to sell those homes.

Article source: http://feeds.nytimes.com/click.phdo?i=c3095b2a58206e06b16199ab021c3442