May 7, 2008


New-Home Sales Plunge To Lowest Level In 16 1/2 Years
WASHINGTON, D.C. — Sales of new homes plunged in March to the lowest level in 16 1/2 years as housing slumped further at the start of the spring sales season. The median price of a new home in March compared with a year ago fell by the largest amount in nearly four decades.

The Commerce Department reported Thursday that sales of new homes dropped 8.5% last month to a seasonally adjusted annual rate of 526,000 units, slowest sales pace since October 1991. That follows a downwardly revised 575,000 rate in February.

Economists polled by Reuters had forecast March sales to slow to a 580,000 annual pace from the previously reported 590,000 reading the month before.

The March median sale price for a new home was 13.3% below March 2007 and, at $227,600, was down 6.8% from the month before. The Commerce Department said the year-on-year percentage decline was the largest since a 14.6% drop in July 1970.

The dismal news on new-home sales followed earlier reports showing that sales of existing homes fell 2% in March. Housing, which boomed for five years, has been in a prolonged slump the past two years with sales and home prices falling most sharply in areas of the country that boomed the most.

For March, sales were down in all regions of the country, dropping most in the Northeast, a decline of 19.4%. Sales fell 12.9% in the West, 12.5% in the Midwest and 4.6% in the South.

The inventory of unsold homes dipped 1.1% to 468,000 which, at the current level of sales, would take 11 months to clear, up from February's 10.2 months' supply.

Source: Associated Press, April 28, 2008

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Brought to you by the Steel Framing Alliance (SFA) on the first Wednesday of each month, Framework Online arms you with the latest news and commentary on the steel framing and construction industries. In addition to industry headlines, trends and project profiles, Framework Online provides information and ideas that will better enable members to increase their participation in the residential and commercial construction markets.