Daily Real Estate News | February 24, 2010
Sales of new homes declined 11 percent in January from December to the lowest level since the U.S. began keeping records in 1963, according to a report from the U.S. Commerce Department released Wednesday.
Sales dropped to an annual pace of 309,000 with the median price falling to $203,500 in January, the lowest since December 2003. At the current sales rate, there is a 9.1 months' inventory of new homes.
New home purchases are 6 percent of the housing market.
“New-home sales may be at rock-bottom levels, but it looks like the housing correction is not over yet,” Chris Rupkey, chief financial economist at Bank of Tokyo-Mitsubishi UFJ Ltd., said before the report. “Everyone who was going to buy for the tax credit has already purchased a new home.”
Meanwhile Toll Brothers Inc., the largest U.S. luxury-home builder, narrowed its losses as new orders doubled. “The housing market took several years to recover, following the downturn of the late 1980s and early 1990s,” Chief Executive Officer Robert Toll said in the statement. “We expect this recovery to follow a similar pattern.”
Source: Bloomberg, Bob Willis (02/24/2010)