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New Home Sales Hit Record Low: "The Housing Market Has Literally Collapsed; We’re Stuck, It’s Not Going To Revive In The Spring And May Not In The Summer"

Source - Marketwatch

WASHINGTON (MarketWatch) — Sales of new single-family homes collapsed in February, the Commerce Department reported Wednesday, as a combination of high unemployment, tumbling prices and a glut of cheaper alternatives brought activity to a near-standstill.

New-home sales fell 16.9% to a seasonally adjusted annual rate of 250,000 in February, though January’s figures were revised higher to 301,000 from 284,000. Compared to February 2010, sales collapsed by 28%.

Every region but the West saw record lows, and in the Northeast, sales dropped by 50% compared to year-earlier levels.

Read “Dismal home-sales data tell us nothing new.”

“The housing market has literally collapsed,” said Tony Sanders, a real estate finance professor at George Mason University. “We’re stuck, it’s not going to revive in the spring and may not in the summer.”

Economists polled by MarketWatch had expected a slight rise to a 290,000 rate in February. While inclement weather may have played a role in the particularly poor showing during the month — the particularly nasty dive in the Northeast and Midwest lends support to such a view — analysts said the figures were reflective of a basically dead market.

“The details of the new-home sales release clearly indicate that the housing market remains incredibly soft,” said David Resler, chief economist of Nomura Securities International.

“There’s massive excess [supply] on the market, interest rates are not at record lows, tighter credit standards, unemployment is not decreasing fast enough and throw in oil and gas prices, that sends a big stop sign on consumers buying homes,” Sanders said.

http://dailybail.com/home/new-home-sales-hit-record-low-the-housing-market-has-literal.html
 
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