US home sales rebound in February

Sales of new homes in the United Sates rebounded by 4.7 per cent in February after hitting a record low in the prior month, the US Commerce Department reported Wednesday.

The department said that home sales rose in February to a seasonally adjusted annual rate of 337,000 from an upwardly revised January figure of 322,000. Even after the revision to January's sales results, the month remained the worst on records dating back to 1963.

However, sales were still down by more than 43.8 per cent from the same month a year earlier. The median sales price fell to $209,000, a record 18 per cent drop from the same month last year. The median price is the midpoint, where half sell for more and half for less.

Sales rose in two of four regions in February. The South had the biggest gain, showing an increase of 9.7 per cent while sales in the West rose 6.6 per cent. The Midwest took the biggest hit, showing a loss of 9.1 per cent, while sales dropped by 3.2 per cent in the Northeast. Midwest sales are at their lowest level since October 1982.

Fallout from the housing crisis is one of the biggest problems facing the country. It has played a central role in the US recession, now in its second year. Foreclosures have spiked, financial companies have racked up multibillion-dollar losses and homebuilding companies have seen revenues plummet.

To lure buyers, President Barack Obama's stimulus package included an $8,000 first-time homebuyer tax credit. Plus, the Obama administration has unveiled a $75 billion plan to curb foreclosures, which are aggravating problems in the housing market and the overall economy.