Purchases of new homes in the U.S. surged in April to the highest level since the start of 2008, pointing to a robust spring selling season for builders.
Sales jumped 16.6 percent to a 619,000 annualized pace, and purchases in the first three months of the year were revised higher, Commerce Department data showed yesterday. The rate exceeded the most optimistic forecast in a Bloomberg survey. The median sales price climbed to a record, reflecting a pickup in signed contracts for more expensive properties.
The rebound in purchases signals housing was returning to more stable footing, helped by healthy employment gains and cheap borrowing costs. The number of homes sold and not yet under construction climbed to the highest level since May 2007, indicating homebuilding will help add to economic growth.
“The spring selling season is off to a decent start,” Ryan Sweet, a senior economist at Moody’s Analytics Inc. in West Chester, Pennsylvania, said before the report. “I think it’ll add more to growth this year than it has in the past several.”
The gain in demand last month was paced by the South, where sales climbed 15.8 percent. Purchases rebounded in the West and climbed in the Northeast.
The supply of homes fell to 4.7 months from 5.5 months in March. The median sales price of a new house increased 9.7 percent from April 2015 to a record $321,100. Purchases climbed for dwellings priced at $300,000 or more.
New-home sales, which account for about 10 percent of the residential market, are tabulated when contracts are signed. Michelle Jamrisko, Bloomberg
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