New Home Sales Inch Upward in March

The pace of new home sales increased by 1.5 percent in March to a seasonally adjusted annual rate of 417,000; steady job creation and low mortgage rates are encouraging more home purchases.

Sales of new U.S. homes grew in March, as near record-low mortgage rates helped the industry complete its strongest quarter since 2008.

Purchases of single-family properties climbed 1.5 percent last month to a 417,000 annual pace, according to an April 23 Commerce Department report, though they were below January's 445,000 "?u the fastest rate since July 2008. While sales are only about half of the level economists consider healthy, the rate has increased 18.5 percent from 352,000 a year ago.

"There is momentum in the housing market, in that inventories are lean, prices are picking up, and people are trying to buy, which is fueling the recovery," said Daniel Silver, an economist at JPMorgan Chase & Co. and the second-best forecaster of new-home sales in the past two years, according to data compiled by Bloomberg. "You're seeing spillover in the housing market from broader economic improvement."

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.

Home sales averaged a 424,000 annual rate in the first three months of 2013, the strongest since the third quarter of 2008.