Ahead of the Bell: US Home Sales
WASHINGTON (AP) — Sales of U.S. previously occupied homes likely topped 5 million in March, the first time it will have crossed that threshold in 3½ years.
Economists forecast that sales rose from a seasonally adjusted annual rate of 4.98 million in February to just over 5 million, according to a survey by FactSet.
The National Association of Realtors will release the report at 10 a.m. EDT Monday.
In February, sales rose just 0.8 percent from January, but were 10.2 percent higher than a year earlier.
Another good sign in February's report was that the number of homes available for sale rose for the first time in nearly a year. That suggests more homeowners are confident that they can sell at a good price. It could also fuel more sales, which have been held back by limited inventory.
The supply of homes for sales rose 10 percent in February, the first monthly gain since last April. Still, inventory was 19 percent lower than a year ago.
Steady hiring and near-record-low mortgage rates have helped boost home sales. More Americans are moving out on their own after living with friends and family in the recession. That's creating more housing demand. Private investors have also driven sales by purchasing single-family homes at low prices and renting them out.
Even if sales rise, they will likely remain below the 5.5 million that economists associate with healthy markets.
And first-time buyers, who are critical to a housing recovery, made up only 30 percent of sales in February. That's well below the 40 percent typical in a healthy market.
Since the housing bubble burst more than six years ago, banks have imposed tighter credit conditions and required larger down payments. Those changes have left many would-be buyers unable to qualify for super-low mortgage rates.
Mortgage rates dropped last week to near-record lows. The average rate for a 30-year fixed mortgage dropped to 3.41 percent from 3.43 percent. That's not far from the record low of 3.31 percent in November.
Rising demand and short supplies have encouraged builders to boost construction. U.S. builders started work on more than 1 million homes at an annual pace in March, the first time they've topped that threshold in nearly 5 years.