WASHINGTON – U.S. sales of new homes last month registered the biggest decline in more than two years.
The Commerce Department said Tuesday that new home sales slid 11.4 percent in April to a seasonally adjusted annual rate of 569,000. It was the largest monthly decline since March 2015. Economists had expected a more modest retreat of March the sales of 642,000, which were the highest since October 2007. Sales in April were 0.5 percent compared to a year earlier.
Economists were inclined to the in April to be read in a one-month blip. Ian Shepherdson, chief economist at Pantheon macroeconomics, called last month’s drop “a correction of the March cycle high, not a warning … We expect the sales to rebound somewhat in May, and return to high March, at least, the next few months.”
A healthy labour market is expected to give the Americans the confidence to buy homes. Employers added a solid 211,000 jobs last month, and the unemployment rate is at a decade-low of 4.4 percent.
But last month, new-home sales fell in every region, led by a 26.3 percent dive in the West, the biggest decline since October 2010.
The median sale price of a new home slid 3 percent to $309,200.
There were 268,000 new homes for sale in April, the most since July 2009.
The Ministry of Trade reported last week that construction of new homes fell for the second consecutive month in April, decreasing from the housing to the lowest point since November.