Wednesday, May 18, 2011

March new home sales: still at ten-year low

New single-family home sales fell again in the US, and in the West region, which includes Colorado. New home sales fell back to the lowest March total recorded in at least ten years.

The report, which monitors sales activity for newly constructed houses, reported that in the West, new home sales were down, year over year, falling 19 percent to 7,000 in March 2011 from 9,000 new homes sold in March 2010. Nationwide, sales dropped off 22 percent, falling from 36,000 to 29,000 during the same period.

In March, new home sales were at the lowest point for the lowest volume in at least a decade, and are now even with March 2009's total. The first chart shows monthly new home sales totals for each month since 2003. March’s total of 7,000 new homes sold is below totals for both March 2010 and is even with the total for March 2009.

For the West region:

New home sales and new home inventory continue to fall and have generally followed a downward trend since the middle of the decade.

New home sales peaked during the spring and summer of 2005 and have trended downward since. The number of new houses sold in the United States is down 77 percent since the peak of March 2005, and new home sales in the West have fallen 81 percent since sales peaked in the region during March 2004.

The third chart shows the declines in both US and regional totals in new homes for sale.

The number of new homes for sale has also fallen off considerably. The number of new houses for sale in the West has fallen 71 percent since the total peaked during June 2007, and the same total has fallen 68 percent in the US since the number of new homes for sale peaked in the US during August 2006.

The number of new single-family homes for sale is now at the lowest level it's been in more than ten years.

In the most recent housing starts data for April, discussed here, there is still no evidence any any imminent jump in the number of new homes being constructed, so new home sales and homes for sale are likely to continue at very low levels, at least in the near term. On the other hand, in the same housing starts data, there is some evidence of an uptick in activity among multifamily structures.