The sale of new US homes plunged in March, falling off seven-year highs in the latest sign the housing market was recovering in starts and stops following a harsh winter.
US new home sales declined 11.4 percent to a seasonally adjusted annual rate of 481,000 in March, the Commerce Department reported on Thursday. February’s sales pace was revised up to 543,000, a seven-year high.
A median estimate of economists forecast a 3.9 percent drop to 513,000 in March.
Compared to year-ago levels, new home sales increased 19.4 percent.
On a regional level, sales declined in all but one region, the Midwest, which posted a 5.9 percent gain. New home sales plunged 33.3 percent in the Northeast, 15.8 percent in the South and 3.4 percent in the West, official data showed.
The median sales price of a new home in March was $277,400. The average sales price was $343,300. Inventory levels at the end of March were 213,000, representing a supply of 5.3 months.
Existing home sales made a large comeback in March, reaching an 18-month high, data from the National Association of Realtors showed on Wednesday. Existing home sales increased 6.1 percent to a seasonally adjusted annual rate of 5.19 million, well above forecasts calling for a 3 percent gain. Sales activity picked up across the country, thanks to ongoing stability in the labour market and sizable pent-up demand.
Mortgage rates also remain favourable, giving buyers more confidence to enter the market. The average commitment rate on a 30-year fixed rate mortgage averaged 3.77 percent in March, well below year-ago levels.