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New-home sales fell across most of U.S. in February

New-home sales fell across most of U.S. in February
New-home sales unexpectedly dropped in March. (Patrick T. Fallon / Bloomberg)

Sales of recently built homes fell back in February, as harsh weather and high costs held back buyers.

New-home sales dropped 3.3% from January to a seasonally adjusted annual rate of 440,000 last month, the Commerce Department said Tuesday. Economists had expected sales to drop after an unexpected surge in January.

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Economists, though, anticipated a slightly better showing. The median forecast for those polled by Bloomberg News was for an annual rate of 445,000. January's rate was also revised downward from 468,000 to 455,000.

The report comes as builders have expressed pessimism over the new-home market. Developers have said a shortage of ready-to-build lots, few skilled workers and rising building costs have held them back.

New-home buyers have also struggled recently with cold weather and higher prices and mortgage rates.

Sales fell in all regions except the Midwest, where they surged 36.7%. Sales dropped 15.9% from January in the West, a major homebuilding region spared February's extreme weather.

The national median price for a new home was $261,800 last month, up from $260,800 in January. Compared with February 2013, the median price fell 1.2%.

If homes sold at their current pace, the existing supply for sale would run out in 5.2 months. Economists consider a supply of about six months to be healthy.

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