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U.S. new-home sales posted their strongest monthly rise in more than eight years

Purchases of new, single-family homes in the U.S. was up 16.6% in April from a month earlier beating consensus for a 2.4% rise.  U.S. new-home sales posted their strongest month in over eight years while prices jumped to a record level. Data signalled a healthy demand alongside limited supplies across the housing market.

The median price of a new home—the point at which half of homes were sold above and half sold below—rose to $321,100 last month. That was up 9.7% from a year earlier and the highest level on record. Prices aren’t adjusted for seasonal factors.

”The fundamentals for new home sales are good, and getting better: more jobs, rising wages, more household formations, and very low mortgage rates,” said Gus Faucher, deputy chief economist at PNC Financial Services.

Broader trends suggest the market has regained its footing after a choppy first quarter. Steady job gains and low mortgage rates have encouraged more Americans to buy new homes. That trend is driving home construction and helping support the economy. Upbeat data raises the odds of a June hike which are now back at 34% this morning and a July move at 53.8%, making it more likely than not.

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