US new home sales fall in February
The Commerce Department has today revealed a fall in sales of new homes in the US for the month of February.
According to the Commerce Department, new single-family home sales fell by 2.2% on the month to a seasonally adjusted annual rate of 308,000 units – the lowest since records commenced in 1963.
Meanwhile, the fall represented the fourth consecutive monthly fall in new home sales and was much lower figure than economists had expected.
The housing market is crucial to the recovery of the world’s largest economy but house prices in the US continue to fall in the face of consumer worries about the strength of the economic recovery due to high unemployment.
The figures come just a day or so after the National Association of Realtors (NAR) revealed a fall in sales of previously owned homes in the US for the month of February.
The industry body said sales fell 0.6% in the month to an annual rate of 5.02 million units (an eight-month low), down from 5.05 million the previous month.
February’s fall was the third consecutive month sales had declined and have raised concern that the market may be heading for a double dip in both activity and prices.
Zach Pandl at Nomura Securities said: “The housing market is really struggling to find its footing despite huge government support efforts. The near-term outlook for the housing market remains quite poor.”
Both sets of figures suggest the extension of the $8,000 tax credit for first-time buyers is having little appeal. The incentive was due to expire in November but was extended to 30 April.
Sales surged prior to the extension as buyers rushed to take advantage of the credits, however, the scheme appears to have run out of steam.
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