New home sales increased by 11 percent in March from February according to the US Commerce Department on Monday, April 25, 2011.
New-home sales last month increased in almost every region of the country. In the northeast, where a hard winter hit, sales jumped to nearly 67 percent; in the West, where a buying surge took place because of a January 1 deadline for a California state tax credit, sales climbed by almost 26; and in the Midwest, sales increased by nearly 13 percent. Sales only fell in the South, the country’s biggest home-sale market, with a rate of 0.6 percent.
The increase followed three straight monthly declines. The seasonally adjusted rate for home sales in March was 300,000 homes, which is 11% higher than February’s all-time low of 270,000.
The actual figure was a bit better than what was expected. Economists surveyed by Briefing.com forecasted sales for March to 280,000 homes.
Though there was an increase, the March figures are still close to the lowest levels recorded since 1963. Also, if it is compared to March home sales last year, it is lesser by 21.9%.
The upturn in home sales, however, does not mean a recovery in the residential sector. Economists are reminding people that one decent month of data will not mean a turn around in the housing market. The housing market is still far from recover as of now.
Barclay’s Capital Senior US economist Michael Gapen thinks that there will be a very gradual rebound in the housing market, which will be related to gradual improvement in the job market.
Given the pace of the home sales, economists are expecting that houses would take seven months to clear off the market.