Tuesday November 24th, 2015 5:15PM

Sales of new US homes plunge 14.5 percent in March

By The Associated Press
WASHINGTON (AP) -- The number of Americans buying new homes plummeted in March to the slowest pace in eight months, a sign that real estate's spring buying season is off to a weak start.

The Commerce Department said Wednesday that sales of new homes declined 14.5 percent last month to a seasonally adjusted annual rate of 384,000. That was the second straight monthly decline and the lowest rate since July 2013.

Sales plunged in the Midwest, South and West in March. But they rebounded in the Northeast, where snowstorms in previous months curtailed purchases.

New-home sales have declined 13.3 percent over the past 12 months.

"Our core view is that the housing market has stalled and won't contribute" to overall economic growth this year, said Ian Shepherdson, chief economist at Pantheon Macroeconomics.

Rising home prices have caused some buyers to back off at the lower end of the market, while new-home buyers at the top continue to buy. As a result, median sales prices jumped 12.6 percent during the past month to $290,000.

Home sales usually improve with the start of the spring. More would-be buyers venture to open houses. Families with children often begin to look for homes so that they can move once the school year ends.

Builders anticipated a snap back with the warmer weather. There were 193,000 new homes for sale at the end of the month, about 39,000 more than the same period last month.

Several other indicators also show that housing activity was muted last month.

The National Association of Realtors said Tuesday that sales of existing homes edged down 0.2 percent to a seasonally adjusted annual rate of 4.59 million. It was the seventh drop in the past eight months.

Sales have fallen, in part, because few homes are for sale. There is a 5.2-month supply of existing homes on the market, much less than the 6-month level seen in healthier markets. More construction is needed to boost the supply, the Realtors' group argues.

But the improvement in building has been slight.

Builders started work on 946,000 homes at a seasonally adjusted annual rate in March, up 2.8 percent from 920,000 in February, the Commerce Department said last week. Those figures include both single-family homes and rental properties. Applications for permits, a gauge of future activity, fell 2.4 percent last month to a seasonally adjusted annual rate of 990,000.

The National Association of Home Builders/Wells Fargo builder sentiment index was 47 in April. Readings below 50 indicate that more builders view sales conditions as poor rather than good.

Sales have also been modest because of affordability issues.

Rising prices over the past year and higher mortgage rates have made it harder for many Americans to afford a home. Real estate data provider CoreLogic says home prices rose 12.2 percent in the past year. Wage growth last year failed to keep pace with the higher buying costs.

The average rate on a 30-year mortgage was 4.27 percent last week. Rates surged about 1.25 percentage points from May through September, peaking at 4.6 percent. Those increases began after the Federal Reserve signaled that it would begin to pull back from its bond-buying program.

Those Fed bond purchases were designed to keep long-term interest rates low to spur more borrowing and boost economic growth. Since December, the Fed has reduced the size of its monthly purchases to $55 billion from $85 billion.
© Copyright 2015
All rights reserved. This material may not be published, broadcast, rewritten, or redistributed without permission.
Judge denies motions to move, delay Tsarnaev trial
Lawyers for Boston Marathon bombing suspect Dzhokhar Tsarnaev asked a federal appeals court Wednesday to overturn a judge's decision to not move his upcoming trial out of state.
10:02PM ( 10 months ago )
High court to adopt electronic filing of cases
The Supreme Court is belatedly developing an electronic filing system similar to those used in courts around the country, Chief Justice John Roberts said Wednesday in his annual end-of-year report.
7:57PM ( 10 months ago )
Storm brings snow, cold to West for New Year's
A blustery winter storm dumped snow and ice across the West on Wednesday, making driving treacherous in the mountains from California to the Rockies and forcing residents and party-goers in some usually sun-soaked cities to bundle up for a frosty New Year's.
5:19PM ( 10 months ago )
U.S. News
State DOT awards $48M contract for NE Ga. road project
The state Department of Transportation has awarded a $47.8 million contract for nine miles of work on a northeast Georgia road.
9:37AM ( 10 months ago )
Business News
Grass fire impacts rush hour traffic on 985
Rush hour traffic on I-985 was slowed by a grass fire Wednesay afternoon with one lane closed while firefighters fought the blaze.
10:19PM ( 10 months ago )
Hall County conviction, sentencing to be reviewed by SCOGA
The State Supreme Court has agreed to hear the appeal of a Hall County man when they reconvene in January.
2:37PM ( 10 months ago )
Maysville man dies from Banks County wreck
The Georgia State Patrol reports that alcohol and/or drugs were factors a single-vehicle wreck that claimed the life of a Maysville man in Banks County Tuesday night.
11:07AM ( 10 months ago )
Local/State News
Non-life-threatening injuries reported in small plane crash
Gwinnett County police and fire officials say two people received non-life-threatening injuries after a small plane went down in the backyard of a private home.
4:38PM ( 37 minutes ago )
Who's open for Thanksgiving and Black Friday shopping
More and more businesses are opening their doors on Thanksgiving instead of Black Friday. Here are the hours for some popular North Georgia shopping centers.
4:00PM ( 1 hour ago )
Man booked on charges in fatal Forsyth County wreck
One of two drivers involved in a fatal traffic accident just off of Georgia 400 in Forsyth County a week ago faced charges in the case Tuesday.
2:25PM ( 2 hours ago )
Stormwater program and fees await Gainesville City Council vote
The Gainesville City Council plans to vote next week on the creation of a Stormwater Management Program and implementation of fees to fund it.
2:07PM ( 3 hours ago )
Ga. gas prices dip below $2 a gallon
Just as Georgia motorists are about to load up the car for this week's Thanksgiving trip comes the news that the average gasoline price in the state has ticked below the $2 a gallon mark.
10:30AM ( 6 hours ago )