Sales of New Homes Fall Sharply
After a couple of days of good macroeconomic news, some bad news. Covered by the able Martin Crutsinger:
Sales of New Homes Fall Sharply: Sales of new homes fell sharply for a second consecutive month in February, a weaker-than-expected performance that dimmed hopes for a rebound in the troubled housing market. The Commerce Department reported Monday that sales of new single-family homes fell by 3.9 percent last month to a seasonally adjusted annual rate of 848,000, the slowest sales pace in nearly seven years....
The February decline followed an even larger 15.8 percent drop in sales in January, which had been the largest one-month plunge in 13 years. The back-to-back declines provided evidence that the housing market is continuing to struggle with lagging demand and a glut of unsold homes. The weakness in sales pushed the median price of a new home down to $250,000 in February, a drop of 0.3 percent from a year ago....
The performance of new home sales was in contrast to a report last week that sales of existing homes rose in February by the largest amount in nearly three years. Analysts had expected new home sales to increase in February as well, based on a view that January's steep plunge had overstated the weakness in housing. The back-to-back declines in the new home market served to support the forecasts of private analysts who believe the slowdown in housing has more months to run its course....
For February, the number of unsold homes rose by 1.5 percent to 546,000. That meant it would take 8.1 months to sell all of those homes at the February sales pace, up from 7.3 months in January...
