New Home Sale For March 2010 Jump 26.9%

According to a government report, new home sales jumped 26.9 percent for the month of March. This was the largest advance since April of 1963. This rebound can be attributed to several factors. The tax credit for first time home buyers is about to expire April 30th so there is a rush of Buyers trying to beat the deadline to take advantage of the tax. Another factor is the weather for January and February may have slowed production of new construction. Lastly, Builders have been offering great incentives for Buyers to purchase homes. There will always be an appeal for new construction over resale homes.
So does this show rebound for new construction? Only time will tell if the number of unit built will keep increasing. Key months to watch will be May and June figures to see if the end of the tax credit has any effect of new construction sales. Central Florida and areas surrounding Orlando have seen similar increases in new construction. Resale inventories on resale homes are at a 4 year low and mortgage rates are still very competitive hovering around the 5.25% -5.5% range.
Only time will tell what impact the recent sput in sales really means. One month of increases does not show a trend to recovery but it is a bright spot when looking to find some positive news in an economy trying to recover.