Lower interest rates and increased consumer confidence have resulted in increased sales of new homes in January, according to some of the nation’s largest home builders.

The Wall Street Journal tells MHProNews  that Taylor Morrison Home Corporation, a builder in five states, on Wednesday reported a 30% increase in its January sales from a year earlier, following its 24% gain in the fourth quarter. In addition, on Tuesday, M/I Homes, Inc., reported that its January sales were up 8%. Other builders including Pulte Group, Inc., Ryland Group, Inc., and Beazer Homes USA also said that their January sales exceeded their sales of the same period in 2014

Sheryl Palmer, Taylor Morrison’s president and chief executive, said, “We’ve seen a momentum building in mid-December and continuing to build through all of January. It was just a phenomenal week last week.”

Analysts and builders point to several factors that may be buoying buyer confidence. The average interest rate on a 30-year, fixed-rate mortgage stood at 3.66% last week, down from 4.32% a year earlier. Job and wage growth have gained momentum in recent months, and lower gas prices have emboldened some buyers. In addition, recent changes by the Federal Housing Administration to lower mortgage-insurance costs and down-payment requirements for entry-level buyers have also encouraged prospective homeowners to begin looking again.

“I’ve got to tell you right now, I feel pretty good about what we see in the market in January and how everybody is reacting,” said Larry Nicholson, CEO of Ryland Homes, on a call last Thursday with investors to discuss the builder’s quarterly results. “I see a lot more positives this year before the Super Bowl than I have in the past, quite a few.”

Many economists expect both resales and new-home sales to increase strongly this year. The National Association of Realtors predicts that resales will increase by 6.6% in 2015. In December, new homes reached an annual sales pace of 481,000, the highest in more than six years.

Redfin, a real-estate brokerage firm operating in 28 states, reports that in the final week of January, requests from prospective buyers for its agents to set up home tours were up 35% from the same period a year earlier.  In the same time period, offers written by Redfin agents in those markets were up 29%. ##

(Photo Credit: Pulte Homes)

 

Article submitted by Sandra Lane to – Daily Business News – MHProNews.