U.S. home sales soared 11.8 percent in February, aided by accelerating wages and falling mortgage rates that are improving affordability.
The National Association of Realtors said Friday that existing homes sold at a seasonally adjusted annual rate of 5.51 million last month, a decisively sharp rebound from a pace of 4.94 million in January.
The burst in sales points to the housing market regaining the momentum that it lost in the middle of 2018, after a spike in rates for home loans caused sales to slow. The February sales figures point toward growth in sales of homes priced between $250,000 and $500,000, a range that is generally affordable to middle-class families.
“This was fueled principally by an improvement in affordability resulting from a combination of slower house price gains, lower mortgage rates and more rapid wage growth,” said David Berson, chief economist at Nationwide Mutual Insurance.
Budget deficit hits record high
The federal government posted a record budget deficit in February, pushing the overall deficit for the first five months of the budget year up 39 percent from a year ago.
The Treasury Department said Friday in its monthly report that the deficit hit an all-time high for February of $234 billion. That surpasses the old February deficit record of $232 billion set in 2012, the last year the deficit for the year topped $1 trillion.
For the first five months of this budget year that began on Oct. 1, the deficit totals $544.2 billion, up from a deficit of $391 billion in the previous budget year.
In its new budget sent to Congress last week, the administration is projecting that this year’s deficit will total $1.09 trillion and will remain above $1 trillion for the next four years. The administration’s 2019 forecast would represent a 40 percent increase from last year’s deficit of $779 billion.
GM to hire 400 to make electric car
After weeks of criticism over its U.S. manufacturing cuts, General Motors said Friday it plans to spend $300 million to build a new electric car at its Orion Assembly Plant north of Detroit and provided a vigorous defense of its U.S. manufacturing commitment.
GM said it plans to add about 400 workers at the Orion factory, which currently builds the electric Chevrolet Bolt, autonomous vehicles for GM’s Cruise unit, and the Chevy Sonic compact car.
GM CEO Mary Barra made the announcement at a meeting involving UAW officials and a range of elected officials, including Gov. Gretchen Whitmer and U.S. Rep. Elissa Slotkin, who gathered at the 4.3 million-square foot plant in Lake Orion, Mich., which employs about 1,166 people.
“GM is absolutely committed to investing in and growing good-paying manufacturing jobs in the United States,” Barra said, part of an implicit response to President Donald Trump’s attacks on the company’s move to idle its factory in Lordstown, Ohio.
Barra said provisions of the proposed new trade agreement among the United States, Mexico and Canada helped persuade GM that the vehicle should be built in the United States.