New Home Sales Drop 5.3%; Down 40.1% Since Last Year

Apparently forecasters were only looking for a drop of 3% in new home sales, but shockingly the slide came in much deeper than that, at 5.3%. realise that this is just a month-over-month decline. Compared to last year, sales of new homes are down 40.1%

Sales of new one-family houses in October 2008 were at a seasonally adjusted annual rate of 433,000, according to estimates released jointly today by the U.S. Census Bureau and the Department of Housing and Urban Development. This is 5.3 per cent (±15.0%)* below the revised September of 457,000 and is 40.1 per cent (±9.9%) below the October 2007 estimate of 723,000. The median sales price of new houses sold in October 2008 was $218,000; the average sales price was $272,300. The seasonally adjusted estimate of new houses for sale at the end of October was 381,000. This represents a supply of 11.1 months at the current sales rate.

The numbers are a lot worse than the modest volume drop in existing home sales, but remember, about half of those were foreclosures. That’s the problem with new home sales — nobody’s lived in them yet, so foreclosure sales.

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