P.M. BRIEFING : Demand Slack as February Sale of New Homes Rebounds 3.1%

Sales of new homes last month rebounded 3.1% from steep declines in December and January but remained at their lowest level in nearly a year, the government reported today.

The Commerce Department said new single-family homes were sold at a seasonally adjusted annual rate of 607,000 units in February after plummeting 6.8% in January and a revised 8.0% in December.

Sales in both January and February were the lowest since 556,000 homes were sold on an annual basis last March. Sales totaled 589,000 in January.

Sales in December--the fourth coldest on record--had dropped to 632,000. But January was the warmest on record and analysts were surprised at its failure to lure buyers.

February also was unusually warm but failed to bring sales back to the level of 649,000 units sold in 1989.

Interest on fixed-rate mortgages rose from 10.17% at the beginning of February to 10.31% before falling to 10.23% at month’s end, according to the Federal Home Loan Mortgage Corp.