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Sales of new homes rise 1.5% in March to 417,000

WASHINGTON — U.S. sales of new homes rose in March to a seasonally adjusted annual rate of 417,000. The increase added to evidence of a sustained housing recovery at the start of the spring buying season.

The Commerce Department said Tuesday sales of new homes increased 1.5 percent. The gain brought the level higher than February’s pace of 411,000, though below January’s 445,000 — the fastest pace since July 2008.

New home sales are still below the 700,000 pace considered healthy by most economists. But the pace has increased 18.5 percent from 352,000 a year ago.

Most economists see more gains ahead, as housing is likely to remain a consistent driver of economic growth this year.

“With increasing signs of a softer U.S. economy springing up in the spring, we can take comfort in the resilience of the housing recovery,” said Jennifer Lee, senior economist at BMO Capital Markets.

Steady job creation and near-record-low mortgage rates are spurring more Americans to buy houses. The rise in demand is helping to boost sales and prices in most markets.

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