Purchases of new U.S. homes hovered in August near a two-year high, adding to signs that the housing market is on the way to recovery.
Sales fell 0.3 percent to a 373,000 annual pace following a revised 374,000 rate in July that was higher than previously estimated and the strongest since April 2010, figures from the Commerce Department showed today in Washington. The median estimate of 71 economists surveyed by Bloomberg called for a rise to 380,000.
Record-low borrowing costs continue to attract buyers, lifting demand for homebuilders, while a drop in the supply of foreclosed homes is easing downward pressure on prices. Federal Reserve policy makers have targeted the housing market with further accommodation measures in order to spur growth and reduce unemployment.
“If you have good credit and you’re not upside-down on your home, it’s a great time to buy a house,” Mark Vitner, a senior economist at Wells Fargo Securities LLC in Charlotte, North Carolina, said before the report. “Folks who have a job and have held onto a job throughout all of the financial crisis and the weak recovery are moving on with their lives.”