The number of sales of new homes in the U.S. increased by more than expected to close the first quarter of the year even as inventories reached a 43-year low and prices slumped, according to Reuters. On Monday, the Commerce Department reported that sales of new U.S. homes increased by 11.1% in March from the prior month to reach a seasonally adjusted level of a 300,000-unit annual pace. The gain outpaced economists’ forecasts for an annual pace of 250,000, although February data was revised up to 270,000 from the record low of 250,000 that had been initially reported.
Despite the strong headline figure, the report showed that new home sales were 21.9% lower than one year ago, while inventories of new homes on the market reached the lowest level since August 1967. The supply of new homes on the market at March’s sales pace fell to 7.5 months’ worth from 8.2 months’ worth in the prior report, with 183,000 new homes available. Additionally, the median sales prices for a new home shed 4.9% in March year-over-year at $213,800, which represents a 2.9% monthly increase.
