Sales of newly built homes - which make up 10% of all home sales – were up 7% from the previous month, according to the Commerce Department. This is in contrast to sales of previously-owned homes, which declined 1.7%, despite record low unemployment, rising wages and low mortgage interest rates.
Jeffrey Mezger, president and chief executive of the L.A. based home builder KB Home, attributes their sales increases to less expensive, starter homes. “As first-time buyer demand has come back, it’s right in our sweet spot”.