Sales of newly built, single-family homes fell 2.2% in February 2010 to a seasonally adjusted annual rate of 308,000 units, the Commerce Department recently reported. While this figure marked a new record low for overall sales activity, only one region (the South) hit its own record low.
“The very slow pace of new-home sales in February was partly due to unusually poor weather conditions, but was also tied to consumers’ ongoing concerns about the poor job market and sluggish economy,” said Bob Jones, chairman of the National Association of Home Builders (NAHB) and a home builder from Bloomfield Hills, Mich.
“Unusually bad weather certainly played a role in the large regional declines depicted in today’s new-home sales report,” agreed NAHB Chief Economist David Crowe. “In addition, many potential buyers remained nervous about their job security and their ability to qualify for a mortgage in light of tight underwriting standards. That said, we are still expecting to see some improvement in consumer demand as the deadline for taking advantage of home buyer tax credits nears. Going forward, other factors such as pent-up demand, new household formations among echo-boomers and excellent affordability conditions will support a 20% gain in new-home sales this year compared to 2009.”
While nationwide home sales fell to a record low in February, a 20.8% gain was registered in the West, with the storm-battered Northeast, Midwest and South posting respective 20%, 18% and 4.6% declines.
The nationwide inventory of new homes on the market rose by a marginal 1.3% in February, to 236,000 units. Due to the slower sales pace, the month’s supply of new homes for sale rose from 8.9 in January to 9.2 in February.
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