New-Home Sales Spurt 27.4% for Best Annual Rate

Sales of new homes shot up by 27.4% in March to the highest annual rate on record, the government reported today.

The Commerce Department said new single-family homes were sold at a seasonally adjusted annual rate of 903,000 units last month.

This is the highest sales rate since the government began publishing monthly sales data in 1963. It surpassed the old record of 872,000 units set in October, 1978.

The 27.4% increase in sales was the biggest monthly advance since a 31% rise in April, 1963.

The boom is attributed to the sharp declines in mortgage interest rates of recent months. Fixed-rate mortgages have dropped below 10% in many places for the first time this decade.