Have New-Home Sales Found the Floor?
It looks like sales of new homes have finally bottomed out.
The Commerce Department reported Friday that after hitting a record low in January — 74 percent lower than they were in July 2005 — new home sales rose in February and were flat in March.
“We believe that the bottom is at hand and that sales will begin turning in the second half of this year,” writes IHS Global Insight economist Patrick Newport. “As previous recessions show, demand for new homes does not evaporate altogether, even in the hardest of times.”
Median sales prices are still falling, down 12 percent in March compared to the same month the previous year. Analysts say they are likely to remain low until inventory is sold off.
Source: The Associated Press, Alan Zibel (04/24/2009)
