Sales of new homes jump

WASHINGTON — More Americans bought new homes in September, a sign that demand remains solid despite a shortage of properties on the market.

Recent hiring gains coupled with low interest rates have bolstered the market for new homes. But builders have struggled to keep pace with construction, creating a shortage of listings for would-be buyers.

New-home sales advanced 3.1 percent last month to a seasonally adjusted annual rate of 593,000, the Commerce Department said this past week. The gains were concentrated in the Northeast, Midwest and South, as sales tumbled last month in the West.

So far this year, sales have increased 13 percent compared with the same period in 2015. The improvement largely reflects the better economic outlook as paychecks are improving and a growing share of homebuyers are seeking new properties.

“Demand for new homes remains strong in response to employment growth, wage gains, positive demographics and mortgage rates near all-time lows,” said David Berson, chief economist at Nationwide.

Sales have steadily grown from the depths of the housing bust and Great Recession over the past three years.

The greater demand has caused narrower inventories of newly built homes. The market contains only 4.8 months’ supply of new homes, down from 5.8 months a year ago.

The declining supply of new homes has modestly boosted prices, which have risen 2.7 percent to an average of $377,700.

Additional construction is unlikely to end the supply crunch. In September, housing starts fell 9 percent to a seasonally adjusted annual rate of 1.15 million.