New Single-Family Home Sales Down in January
Sales of newly built, single-family homes declined 11.2% in January to a seasonally adjusted annual rate of 309,000 units, the slowest pace on record, according to figures released by the U.S. Commerce Department on Feb. 24.
"This disappointing report highlights just how fragile the economic and housing recovery is right now, and the uncertainties that continue to weigh on consumers, particularly with regard to concerns about job security," said NAHB Chairman Bob Jones. "Even with today's exceptionally favorable home buying conditions — including low interest rates, stabilizing house prices and the availability of home buyer tax credits — many consumers simply weren't confident enough to go forward with a new-home purchase in the beginning of this year."
"While the overall economic picture has brightened somewhat, these numbers indicate that the road to a housing and economic recovery remains very uncertain. Many Americans have yet to see much evidence of improvement first-hand, and are therefore reluctant to consider a home purchase," noted NAHB Chief Economist David Crowe.
"Meanwhile, competition from below-market-priced foreclosed and short-sale homes poses an additional challenge to the new-homes market right now,” Crowe said. “Although we continue to expect a boost in overall sales activity prior to the expiration of the $8,000 and $6,500 home buyer tax credits at the end of April, unseasonably poor weather across much of the country may delay the full impact of those incentives until closer to the deadline."
The Midwest was the only region of the country to register an increase in new-home sales in January, posting a 2.1% gain from an abnormally low December rate. January’s pace of new home sales declined by 35.1% in the Northeast, 11.9% in the West and 9.5% in the South.
While the overall number of new homes on the market remained virtually unchanged in January, at 234,000 units, the month's supply rose to 9.1, up from 8.0 in December, due to January’s slower sales pace.
Web Site Is One-Stop Shop for Tax Credit Info
Builders and other industry professionals can help spur home sales by referring prospective home buyers to www.federalhousingtaxcredit.com. The NAHB Web site provides detailed information on both the extended $8,000 first-time home buyer tax credit and the new $6,500 repeat buyer tax credit signed into law by President Obama.
Consumers can use the Web site to find information on both tax credits — including frequently asked questions and links to social media sites that provide updated information as it becomes available. It also includes a number of home-buying resources for consumers.
Industry professionals are encouraged to highlight the tax credit Web site when marketing to their potential home buyer market.