New-home sales held up in February prior to disruptions
Purchases of new homes in February held close to an almost 13-year high, showing momentum in the residential real estate market before economic activity fell victim to the coronavirus.
Single-family home sales eased 4.4% to a 765,000 annualized pace, exceeding the median estimate in a Bloomberg survey, from an upwardly revised 800,000 rate in January. The median selling price increased 7.8% from a year earlier to a record $345,900, government data showed Tuesday.
Housing is set to downshift after enjoying low lending rates, steady job growth and elevated consumer confidence at the start of the year. While increased demand had economists penciling in a contribution to first-quarter growth from residential construction, the outbreak is likely depressing sales this month.
The number of new homes sold and not yet started rose to 231,000, the second-most since early 2007. Those figures indicate a pipeline for builders that could help keep workers at job sites depending on virus-related restrictions.
February purchases fell in the West and Midwest while the Northeast saw a surge in sales and the South, the biggest region, improved slightly from the prior month.
The supply of homes at the current selling rate edged up to 5 months from 4.8 months.
The median forecast in a Bloomberg survey of economists projected an annual sales rate of 750,000 for February after a previously reported 764,000 a month earlier.
The government's data on new-home sales are volatile on a month-to-month basis. Changes in the seasonally adjusted data have a wide margin of error.