Posted on 03/26/2007 7:07:51 AM PDT by tmp02
WASHINGTON, March 26 (Reuters) - Sales of new U.S. homes fell 3.9 percent in February to the lowest rate in nearly seven years while the number of new homes on the market grew, according to a government report on Monday that showed more signs of weakness in the housing sector.
The monthly decline was the second straight and the volume of sales fell to their lowest level since June 2000, when they hit 793,000.
New single-family home sales fell to an annual rate of 848,000 units from a downwardly revised rate of 882,000 in January, the Commerce Department said. Analysts polled by Reuters were expecting February sales to rise to 985,000 from the previously reported rate of 937,000 units in January.
In February, the median sales price of a new home rose $6,800 to $250,000 from $243,200 in January.
At the current sales pace, the supply of new homes available rose to 8.1 months at the current sales pace, the highest rate since January 1991, from 7.3 months in January.
The Commerce Department's data comes days after a real estate trade group reported a stronger-than-expected month of existing home sales.
(Excerpt) Read more at yahoo.reuters.com ...
Maybe some new home builders understand. We are purchasing a new home from Beazer in Los Angeles County. They had list price at $385,990. Settled at $375,990. When we went in to sign papers, without any bargaining, dropped the price to $360,990. I'm not complaining.
Our present house sold in three days to a neighbor for 1% less than our asking price.
Times are rough out there for sellers, but the world has not yet come to an end.
Make that 3% less than asking, since we are paying the buyers closing costs.
The old making a silk purse out of a sows ear, some call it spin.
We have a bingo, you win!!!!
That's a big price jump
They didn't drop the price, they had to lower it to the bank appraisal are lose the deal.
New homes sales may be declining because builders are not moving quick enough to lower prices. Notice same sale houses rose last week and prices declined. New home sales fell and prices rose.
In Illinois, for instance, there was almost two months of unrelieved Arctic air. People just stayed home and mostly refrained from going anywhere except work and quick food-shopping trips. Ask the restauranteurs, theaters etc. about patronage in killer icy weather......and THEIR businesses are indoors!
So I doubt if many home-buyers were out and around looking in on open houses in 16-below wind chill factor.
Now the weather is warming up considerably and the folks are emerging from their burrows like meerkats.
The market will pick up again. The media, not the market, will be sooooo depressed.
Leni
Isn't it. Less new houses selling, but for more money..
Right on the money!
I think the biggest discrepency in the stats is weather. The NAR numbers relect actual closings of existing homes, these numbers reflect signed contracts for new homes. The NAR sales were mostly made in December when most of the country was experience warmer than expected winter weather. These numbers reflect activity in Febuary, which had a long streak of zero degree weather in the midwest and huge snow storms in the east. The truth is probably somewhere in between. Prices are flat, sales are slightly down.
I think you have to consider the extreme cold spells and winter storms that swept across much of the country in February, and take the data associated with activity for that month with a grain of salt. I think there is no doubt the NAR numbers will weaken the next couple of months, while these numbers will show some improvement as the February data will be behind them.
==Isn't it. Less new houses selling, but for more money..
It's harder to get a risky loan now I guess. I know an immigrant whose real estate agent stopped calling her recently and I'm suspecting it's due to the fallout of the funny loans.
Luxury homes in many high cost areas are still selling well. With a lower number of sales in the entry/moderate price range (a much larger number in the past), the DIVISOR is smaller..., hence the AVERAGE increases...
Obviously, you're correct. And obviously Beazer is not in business to lower prices without a fight. I guess my point should have been that the market is behaving in a pretty orderly way, and not just collapsing. And the builders are not at liberty to operate outside market forces.
So far, this is true (except for a few lenders like New Century), and should continue. There are a couple of issues that need to be worked though before housing gets back to full health, but corrections happen -- this one just has some new twists like subprime and option ARMs.
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