Jan
28

The Worst Year for New-Home Sales is Over

January 28, 2012

The sale of new U.S. homes fell in December for the first time in four months to end off a year that saw the lowest new-home sales in history.

According to the U.S. Commerce Department, the sale of newly built, single-family homes dropped 2.2 percent in December to a seasonally adjusted annual rate of 307,000 units.

For 2011, new-home sales fell 7.3 percent to 302,000 units, the lowest number in the history of the government’s record keeping.

But all is not bleak.

roof with the letters sale under it“December’s small decline in new-home sales follows three consecutive months of gains and means the fourth quarter was still stronger than the third,” said Bob Nielsen, chairman of the National Association of Home Builders (NAHB).

And, when the numbers are broken down regionally, the drop in new-home sales doesn’t seem as dramatic.

*South: New-home sales in December fell 10.1 percent in the South, which is the nation’s largest housing market and the reason the overall number of sales was low.

*Midwest: New-home sales dropped 3.7 percent last month.

*West: New-home sales rose 9.0 percent in December.

*Northeast: The sale of new homes surged 46.7 percent.

The inventory of new homes for sale also fell to a new record low of 157,000 units, which equates to a 6.1-month supply at the current sales pace.

NAHB is forecasting that the sale of newly built homes in 2012 will increase 18 percent.

“The bottom line is that, while 2011 was the worst year for new-home sales on record, signs of gradual improvement began to emerge near the end of the year across a growing number of markets,” said Crowe.

“This nascent recovery should continue to gain strength in the year ahead as more buyers take advantage of the very good deals that out there for newly built homes.”

Categories: Economy, New Homes

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