New Homes Sales Drop in February

by IBH Staff Writer 24. March 2010 17:23
New homes sales unexpectedly fell to a record low in February, according to a government report released Wednesday, which was partly attributed to the stormy winter in February and weak economy which kept buyers away.

Sales of new homes fell 2.2 percent to a seasonally adjusted sales pace of 308,000 last month, compared to a upwardly revised annual rate of 315,000 in January, the Commerce Department said Wednesday.

The news follows a report released Tuesday where existing home sales fell for a third straight month in February, to the lowest level since July.

The drop in new-home sales was the fourth consecutive monthly decline and was the lowest rate since the government began tracking new home sales in 1963.

New-home sales were down 13 percent compared to February 2009.

New-home sales dropped in every region of the United States, except the West region, which climbed 20.8 percent. The Northeast was the hardest hit as sales in the region fell 20 percent from a month earlier. Midwestern sales dropped 18 percent while sales fell nearly 5 percent in the South.

The Commerce Department estimated that 236,000 new homes hit the market in February. At the current sales pace, it would take 9.2 months to sell through that inventory. This is up from 9.1 months of inventory in January. Prior to January, inventory was steadily declining.

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