New-home sales show modest gain
April's 3.3% creep up from March may be a sign of small increases still to come.
Ah, the sounds and smells of spring: birds chirping, flowers blooming, subcontractors hammering and fresh ink hitting paper.
After a decrease in March, sales of new homes increased 3.3% in April, the Census Bureau and Department of Housing and Urban Development reported today. The seasonally adjusted rate of 343,000 homes sold also represents a 9.9% increase from April 2011.
Get used to the slight increases: They are “in line with our expectations for a continued, modest increase in home sales as buyers gain confidence in the economy and their jobs,” David Crowe, chief economist for the National Association of Home Builders, told MSNBC.
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According to a Bloomberg poll, experts had expected a 2.6% month-to-month gain.
Yesterday, the National Association of Realtors reported that sales of existing homes registered nearly identical increases: up 3.4% in April from March and up 10% from April 2011.
It's slow progress — but progress nonetheless, 4Cast Ltd. economist Sean Incremona told Reuters:
"The new homes sales data is much like what we saw from existing home sales yesterday. … It is still baby steps. This increase of 343,000 still comes in below that February high, which was probably inflated by weather. It does look like we have found a bottom, which is encouraging, but it is still very slow progress at this point."
April's new-home sales volume is still less than half of the 700,000 mark considered normal for a healthy market, according to National Public Radio. But there is hope for coming months: Construction starts were up 2.6% in April from March. Homebuilder confidence also hit its highest level in nearly five years.
The median sale price of new homes also ticked up slightly from March to $235,700.
Regional new-home sale changes between March and April, from the NAHB:
- Midwest: 28.2% increase
- West: 27.5% increase
- Northeast: 7.7% increase
- South: 10.6% decrease
— Tony Stasiek is a producer/editor at MSN Real Estate.
About Teresa Mears
Teresa Mears is a veteran journalist who has been interested in houses since her father took her to tax auctions to carry the cash at age 10. A former editor of The Miami Herald's Home & Design section, she lives in South Florida where, in addition to writing about real estate, she publishes Miami on the Cheap to help her neighbors adjust to the loss of 60% of their property value.