WASHINGTON - The U.S. Department of Housing and Urban Development and the U.S. Census Bureau reported that sales of newly built, single-family homes dropped 14.5 percent in March.

"Overly stringent underwriting standards for mortgages have had a detrimental effect on modest-priced markets and have hit first-time home buyers particularly hard," said NAHB Chief Economist David Crowe. "As a result, most of the sales are coming from a smaller pool of buyers who have a more established credit history, are more likely to finance with higher cash down payments and are purchasing higher-priced homes."

The inventory of new homes for sale increased to 193,000 units in last month, which represents a six-month supply at the current sales pace.