New Home Sales Bounce Back
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- Peter King | April 25, 2011
New home sales rebounded in March, one month after falling to their lowest point in nearly half a century, according to new figures from the Census Bureau.
Sales of new single-family homes rose to a seasonally adjusted rate of 300,000 a year, up 11.1 percent from the February’s levels. The increase well exceeded analysts’ expectations, but sales remain weak overall, down 21.9 percent from the March 2010 level of 384,000.
February’s annual rate of 270,000 was the lowest rate of new homes sales reported by the Census Bureau in nearly 50 years of record keeping, dating back to 1963.
It’s difficult to say how much of the change is due to actual improvement in sales and how much is from random statistical variations in the monthly surveys. The monthly data is subject to large margins of error and the Census Bureau cautions that several months of data are needed to establish a trend.
New home sales fell off sharply last spring following the end of the homebuyer tax credit, falling by one-third from April to May 2010. Since then, the annual rate has fluctuated in a range around 300,000, varying from 270,000 to 334,000. By comparison, annual rates of new home sales exceeded 1 million units during the boom years of 2003-06.
The median sales price of new homes was $213,800, down from $224,800 one year ago. There were 183,000 new single-family homes for sale in March, representing a 7.3 months’ supply, down from 8.2 months in February.
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