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Mortgage rates, meanwhile, have fallen to record lows, making home-buying more affordable. Still, many would-be buyers are having difficulty qualifying for home loans or can't afford larger down payments required by banks. Though new homes represent just 20 percent of the overall home market, they have an outsize impact on the economy. Each home built creates an average of three jobs for a year and generates about $90,000 in taxes, according to the National Association of Home Builders. There are some hurdles to a smooth recovery: Builders are struggling to compete with deeply discounted foreclosures and short sales
-- when lenders allow homes to be sold for less than what's owed on the mortgage. Another reason sales have fallen is that previously occupied homes have become a better deal than new homes. The median price of a new home is about 30 percent higher than the median price for a resale. That's nearly twice the markup typical in a healthy housing market.
[Associated
Press;
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