Sales of newly built, single-family homes rose 11.1 percent to a seasonally adjusted annual rate of 300,000 units in March, the U.S. Commerce Department reported.
Sales of newly built single-family homes rose 11.1 percent to a seasonally adjusted annual rate of 300,000 units in March, the U.S. Commerce Department said.
The gain somewhat offset the large decline in new-home sales the market experienced during February, the National Association of Home Builders said.
"The fact that new-home sales have regained some of the ground they lost earlier this year is a promising sign at the start of the spring home-buying season," said Bob Nielsen, chairman of the NAHB and a home builder from Reno, Nev. "While potential buyers continue to be extremely cautious, they are starting to take a look around and evaluate their very good options with regard to attractively priced new homes."
NAHB chief economist David Crowe said the month was a more reliable snapshot of real estate sales than February.
"The March pace of new-home sales more accurately reflects current market conditions than the extremely low pace we saw in the first two months of this year, when unusually poor weather likely kept buyers away," Crowe said. "That said, the average sales pace for the first quarter of 2011 held at about the same level seen for the last half of 2010. A limiting factor is the extremely thin inventory of new homes for sale, which is now at its second-lowest level in history. Builders continue to confront major challenges in obtaining financing to build new homes, and the shortage of new product makes it that much tougher for them to compete with existing homes on the market. At the same time, tighter lending conditions are making it more difficult for qualified buyers to obtain a mortgage."