|
 Sales were also boosted by unseasonably warm weather and buyers
rushing into the market in anticipation of higher mortgage rates.
The Federal Reserve raised its benchmark overnight interest rate in
December, the first rate hike in nearly a decade.
"We knew a significant number of closings were delayed by new
regulations that came into effect in October. Overall, 2015 was a
very good year and we're positioned for a strong spring market,"
said Stephen Phillips, president of Berkshire Hathaway Home Services
in Chicago.
The mortgage disclosure rules are intended to help homebuyers
understand their loan options and shop around for loans suited to
their financial circumstances. Realtors said the rules had
significantly increased contract closing time frames.
November's sales pace was unrevised at 4.76 million units.
Economists had forecast home resales rebounding 8.9 percent to a
5.20-million rate in December. Sales rose 6.5 percent to 5.26
million units in 2015, the strongest since 2006.
Last month's snap-back should offer some assurance that domestic
demand remains fairly healthy, even as growth appears to have braked
sharply at the end of 2015 because of a downturn in manufacturing
and mining activity.
The dollar was trading higher against a basket of currencies, while
prices for U.S. government debt fell. The housing index <.HGX>
rallied 2.04 percent, outperforming a broadly firmer U.S. stock
market. Shares in the nation's largest homebuilder D.R. Horton Inc
<DHI.N> were up 2.59 percent and Lennar Corp <LEN.N> advanced 2.16
percent.
FACTORY DATA SURPRISES While a separate report hinted at some
stabilization for the downtrodden manufacturing sector, dollar
strength and on-going efforts by businesses to reduce an inventory
overhang suggest the sector's troubles are far from over.
Data firm Markit said its Purchasing Managers Index bounced back in
early January from December's 38-month low as output and new
business volumes increase at faster rates.
"We expect output and employment growth in the U.S. manufacturing
sector to remain tepid," said Jesse Hurwitz, an economist at
Barclays in New York.
Weak reports on retail sales, inventories, exports and industrial
production have left economists estimating that gross domestic
product increased at an annual rate of less than 1 percent in the
fourth quarter after expanding at a 2 percent pace in the
July-September quarter.
[to top of second column] |
A stock market rout has also added to the gloom over the economy. In
a third report, the Conference Board said its leading indicator
slipped in December after a drop in building permits and
persistently weak new factory orders.
Housing is being supported by a strengthening labor market, which
has resulted in an acceleration in household formation. Sales,
however, remain constrained by a dearth of homes available for sale,
which is limiting choice for buyers. In December, the number of
unsold homes on the market tumbled 12.3 percent from November to
1.79 million units, the lowest level since January 2013.
At December's sales pace, it would take 3.9 months to clear the
stock of houses on the market, the fewest since January 2005, and
down from 5.1 months in November. A six-months supply is viewed as a
healthy balance between supply and demand.
With inventories still tight, the median house price jumped 7.6
percent from a year ago to $224,100. House prices increased 6.7
percent in 2015. Although higher prices could sideline potential
buyers, especially those wanting to purchase a home for the first
time, they are boosting equity for homeowners, which could encourage
them to put their homes on the market.
"The strong price increases will begin to impact affordability, but
they are clearly needed to entice sellers to list their homes for
sale," said Kristin Reynolds, a U.S. economist at IHS Global Insight
in Lexington, Massachusetts.
Last month, the share of first-time buyers was 32 percent, up from
30 percent in November.
(Reporting by Lucia Mutikani; Editing by Andrea Ricci)
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