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BUSINESS A25
Tuesday 22 March 2016
U.S. home sales slump in February;
supply shortage hits market
JOSH BOAK further enhanced by a vol- rentals, further depriving This Thursday, Dec. 3, 2015 file photo shows an existing home for
AP Economics Writer atile stock market that hit the market of supplies. sale in Roswell, Ga. On Monday, March 21, 2016, the National
WASHINGTON (AP) — down payment savings. The Realtors have forecast Association of Realtors reports on sales of existing homes in Feb-
Americans retreated from “We assume the plunge that overall sales levels will ruary.
home-buying in February, in the stock market in the be nearly unchanged this
reversing months of prior first six weeks of this year year, after a 6.5 percent Associated Press
gains as low inventories persuaded some potential gain in 2015. But median
push up prices to levels that homebuyers to reconsider, sales prices are forecast to market, according to a Trulia found a market tilting
restrict sales. at least temporarily,” said rise 4 percent, meaningfully separate report released toward wealthier buyers.
The National Association of Ian Shepherdson, chief faster than wages. Monday by the real estate The inventory of starter and
Realtors said Monday that economist at Pantheon Home-buying fell sharply in firm Trulia. trade-up homes has tum-
sales of existing homes fell Macroeconomics. the Northeast and Midwest At the bottom of the bled more than 40 percent
7.1 percent last month to a Shepherdson noted that last month, while slipping housing market in 2012, a since the start of 2012, while
seasonally adjusted annual sales momentum “stalled” less severely in the South typical homebuyer only premium homes with a me-
rate of 5.08 million. The de- in February, but sales vol- and West. needed to commit 32.2 dian list price of $542,805
cline follows robust yearly umes might pick-up in the Investors accounted for 18 percent of their income account for a larger share
sales rates of 5.47 million in spring. percent of sales in Febru- to buy the median priced of all listings.
January and 5.45 million in The median home sales ary. First-time buyers made starter home. That share Still, sales have been aided
December, a new regula- price was $210,800 in Feb- up 30 percent of purchas- of income has climbed to over the past year by hir-
tion had delayed closings ruary, a 4.4 percent annual es, staying persistently be- 37.7 percent, putting home ing that has pushed unem-
in November. increase from a year ago. low their historic share of 40 ownership out of reach for ployment to a healthy 4.9
The housing market enters Tight supplies have driven percent. many. percent. q
the traditional spring buying the increases in home pric- The shortage remains a
season facing a quandary: es, forcing buyers to bid consequence of the burst
There are relatively few more for hotly contested housing bubble, which ini-
properties listed for sale, homes. tially flooded the market
even as steady job gains Listings in February fell 1.1 with distressed foreclosures
and low mortgage rates percent from a year ago. and then left a limited se-
have bolstered demand Many homeowners are lection of homes for buyers
from would-be buyers. The hesitant to sell, since they as the recovery from the
limited supplies have fu- would need more equity to Great Recession surpassed
eled rising prices that have, cover the down payment 6 ½ years.
in turn, reduced affordabil- for stepping-up to a new Inventory is particularly low
ity and limited sales levels. property. Investors have for starter homes, keeping
These cost pressures were also turned homes into first-time buyers out of the
Stocks shake off an early loss
and end with slight gains
string of gains and suggests day early Monday. The trend could weigh on
an improved outlook by in- Homebuilders fell broadly homebuilders, many of
vestors since the market’s following a report indicat- which rely on buyers who
rocky start to 2016. Worries ing that sales of previously must sell their home before
about the global economy occupied U.S. homes sank they can purchase a newly
prompted the Federal Re- 7.1 percent last month. built one.q
serve to slow the pace of
This Oct. 4, 2014, file photo, shows the facade of the New York interest rate increases this
Stock Exchange. Stocks are off to a mixed start Monday, March year.
21, 2016, as the market comes off its fifth straight week of gains. The Dow Jones industrial
average rose 21.57 points,
Associated Press or 0.1 percent, to 17,623.87.
The Standard & Poor’s 500
ALEX VEIGA higher. index added 2.02 points,
AP Business Writer Investors had their eye on or 0.1 percent, to 2,051.60.
Major U.S. stock indexes the latest batch of com- The Nasdaq composite
eked out modest gains on pany deal news and new gained 13.23 points, or 0.3
Monday, extending the data on housing that sent percent, to 4,808.87.
market’s winning streak homebuilders broadly low- Thanks to steady gains in
into a fourth day. er. Telecommunications recent weeks, the Dow
Stocks wavered into the services and health care is up 1.1 percent for the
red at times before steady- stocks were among the year, while the S&P 500 in-
ing in the late afternoon. biggest risers. dex is up 0.4 percent. The
The price of oil also veered Monday’s action builds Nasdaq is down about 4
lower at times, but ended on the market’s five-week percent.
Stocks had appeared to
be headed for a down
