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Economy in Brief

U.S. New Home Sales Step Up From Record Low
by Tom Moeller March 25, 2009

February sales of new single-family homes ticked up off their lowest level in the series' history. Their 4.7% month-to-month rebound to 337,000 units, nevertheless, left them down by roughly three-quarters from their peak during July 2005. February sales exceeded Consensus expectations for 300,000 units.

The February rebound in home sales was not broad based and limited to moderate increases in the South and the West. Home sales in the Midwest and in the Northeast continued lower.

Reflecting sales weakness was another decline in the median price for a new single-family home. At $200,900, the figure was off 11.6% during just the last two months and by nearly 20% since last year as homebuilders attempted to move inventory. Since their peak early in 2007, new home prices have fallen by roughly one quarter.

In fact, that effort to move homes continued successful and the inventory of unsold homes is down by 43% since the peak during 2006. In each of the country's regions, the inventory is down by one-quarter to one-third just during the last year.

Despite the declines in inventory levels, the month's supply of new homes for sale remains high due to low sales. It ticked down just slightly during February from the record high to 12.2 months.

By range there have no sales of new homes priced over $750,000 during the last three months. There were 1,000 registered sales of a homes priced between $500,000 & $750,000 and 2,000 sales of homes priced between $400,000 and $500,000. These figures compare to sales between 3,000 and 8,000 of homes in the ranges below $400,000.

The new home sales figures are available in Haver's USECON database.

Today's House testimony by Fed Governor Elizabeth A. Duke titled Credit availability and prudent lending standards can be found here

US New Homes February January Y/Y (%) 2008 2007 2006
Total Sales (SAAR, 000s) 337 332 -41.1 479 768 1,049
  Northeast 29 30  -25.6 35 64 64
  Midwest 50 55 -35.1 69 118 161
  South 193 176 -38.5 264 408 559
  West 65 61 -54.2 111 178 266
Median Price (NSA, $) 200,900 206,800 -18.1 230,217 243,742 243,067
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