Mortgage

Sales of new homes in the Northeast and Midwest plunged in February, helping to bring down the market overall across the country, as elevated mortgage rates dissuaded buyers from purchasing property, Newsweek reported. The Northeast registered a 31.5 percent nosedive in single-family home sales, while the Midwest saw a decline of 2.4 percent, contributing to a 0.3 percent of drop at the national level of 662,000, according to data from the U.S. Census Bureau and the Department of Housing and Urban Development. The South had more encouraging data, registering a 3.7 percent increase, while the West also saw positive numbers, up 2.3 percent for the month. Analysts blamed high mortgage rates for the disappointing numbers. Mortgage rates have been elevated, hitting a peak of 8 percent in the fall. Expectations that the Federal Reserve, which had raised borrowing costs to battle inflation, will cut rates had helped bring down the cost of home loans. But inflation has stayed higher than the central bank's target of 2 percent, leading investors to believe that borrowing costs could stay higher for longer. This dynamic has in turn contributed to a jump in mortgage rates in recent weeks.