Cheap prices 'lift US home sales'

by Lionel Creech


Sales rose last month as buyers are getting a bargain as mostly repossessed homes are being sold at very low prices. Overall sales grew by 5.1% and the average price per home dropped a total of 16% from last year. This drop is apparently the second largest fall on record at the National Association of Realtors. The bargain market has sparked renewed interest in entry-level, or first time, buyers. About half of the sales were made by first time buyers which is a promising sign for the industry which is struggling to find reasonable prices for homes. Surprisingly construction rose 22% in February for the first time in seven months, yet analysts are still not expecting great things for the rest of 2009. These 'distressed' homes are selling for 20% less than market value which means sellers are losing out on revenue. Also losing out are citizens who are struggling to find new living arrangements during the economic crunch.