Purchases of new U.S. homes rose more than projected in July to match a two-year high, a sign the industry that helped trigger the recession is recovering.
Sales climbed 3.6 percent to a 372,000 annual pace, following a 359,000 rate in June that was higher than previously estimated, figures from the Commerce Department showed today in Washington. The median estimate of 72 economists surveyed by Bloomberg called for a rise to 365,000. The rate was the same in May, which was the strongest since April 2010.
Buyers are returning to the market to take advantage of cheaper properties and record-low mortgage rates, helping to boost orders at builders like Toll Brothers Inc. (TOL) Competition from foreclosures, unemployment exceeding 8 percent and limited credit pose hurdles to a more pronounced rebound, one reason Federal Reserve policy makers are monitoring housing data.
“There are more and more signs that housing is continuing to gain ground,” Ryan Sweet, a senior economist at Moody’s Analytics Inc. in West Chester, Pennsylvania, said before the report. “The improvement should continue this year.”
Estimates of economists surveyed ranged from 340,000 to 400,000. June’s reading was previously reported as 350,000.