Page 7 - Aruba Today
P. 7
U.S. NEWS A7
Friday 25 September 2015
US Financial Front:
New-home sales surge 5.7 percent in August to 7-year high
C. S. RUGABER after the downturn ended A ‘sold’ sign is displayed in the yard of a newly built home in this year, fueling more buy-
AP Economics Writer in 2009. New-home sales the Briar Chapel community in Chapel Hill, N.C. The Commerce er traffic and purchases.
WASHINGTON (AP) — have soared nearly 22 per- Department reported on sales of new homes in August on Thurs- Ian Shepherdson, chief
Buoyed by steady job gains cent in the past year. day, Sept. 24, 2015. economist at Pantheon
and low mortgage rates, Sales figures for newly- Macroeconomics, says
Americans purchased new built homes are notoriously (AP Photo/Gerry Broome) that new-home prices
homes in August at the volatile and typically re- jumped 10.7 percent in
fastest pace in more than vised heavily in subsequent economy by generating home prices aggressively the final three months of
seven years. months. But most econo- construction jobs, demand last year, likely weighing last year, compared with
New-home sales surged mists were still encouraged for more building materi- on sales, which totaled just a year earlier. But they rose
5.7 percent last month to a by the gains. als and more spending on 414,000 in 2014. That was just 0.8 percent in the April-
seasonally adjusted annual “Housing has been an landscaping and other ser- little changed from sales June quarter from a year
rate of 552,000, the Com- economic bright spot this vices. in 2013. But builders have ago, he said.
merce Department said year and activity in the Home builders raised new- reined in price increases In August, the median
Thursday. That is the stron- new home construction price for a new home was
gest pace since February market remains solid,” said $292,700, just $600 higher
2008, near the beginning of Michelle Girard, an econo- than the previous month.
the Great Recession. Last mist at RBS Securities. The median is the price
month’s increase followed Surveys show that home- where half of all home
an even bigger 12 percent builders’ outlook is the most prices are higher and half
jump in July, according to optimistic in a decade, a are lower.
the government’s revised sign that construction could Federal Reserve Chair Ja-
figures. Healthy hiring and pick up. The supply of new net Yellen said last week
smaller price increases for homes has been scarce, so that she expects the hous-
new homes have finally greater construction could ing market to keep improv-
begun pushing up sales, result in more sales. ing as more people find
which were hammered Strong gains in new-home jobs and younger Ameri-
during the Great Recession sales and construction cans increasingly move
and recovered slowly even could accelerate the out on their own.q
Average US rate on 30-year mortgages falls to 3.86 percent
WASHINGTON (AP) — Av- fixed-rate mortgage fell to day they had decided to majority of Fed officials on could bring higher rates for
erage long-term U.S. mort- 3.86 percent from 3.91 per- keep a key short-term in- the committee that sets the home loans. The Fed has
gage rates declined this cent a week earlier. The terest rate close to zero in federal funds rate — which kept the federal funds rate
week following the Federal rate on 15-year fixed-rate the face of threats from controls the interest which near zero since the finan-
Reserve’s decision to keep mortgages eased to 3.08 a weak global economy, banks charge each other cial crisis struck seven years
interest rates at record lows percent from 3.11 percent. persistently low inflation — still foresee higher rates ago. To calculate average
for now. Rates have stayed below and unstable financial before next year. The Fed mortgage rates, Freddie
Mortgage giant Freddie 4 percent for nine straight markets. But Fed Chair Ja- will meet next in October Mac surveys lenders across
Mac said Thursday the av- weeks. Fed policymak- net Yellen said a rate hike and then December. the country at the begin-
erage rate on a 30-year ers announced last Thurs- was still likely this year. A A rate hike by the Fed ning of each week. q
