No surprises... except the absolute devastation in the Northeast numbers...
Bigger-Than-Expected Drop in New Home Sales Indicates Five-Year Housing Boom Is Slowing
WASHINGTON (AP) -- Sales of new homes fell for the second time in three months in January, providing further evidence that the nation's five-year housing boom is slowing.
The Commerce Department reported Monday that sales of new single-family homes dropped by 5 percent to a seasonally adjusted annual rate of 1.233 million units last month.
That was a bigger drop than analysts had been expecting and provided support to the view that the housing market, after setting sales records for five straight years, is slowing under the impact of rising mortgage rates.
The biggest decline was a 14.9 percent decrease in sales in the Northeast, which followed an even bigger 23 percent plunge in sales in December. Sales in the Midwest were down 10.8 percent after having risen by 21.2 percent in December. Sales fell by 10.3 percent in the South in January following a 1.2 percent gain in December. Bucking the national trend, sales in the West posted an 11.3 percent increase in January after a 6.3 percent gain in December.
Some economists have expressed concerns that once home sales start to slow, the big price increases of recent years could turn into sharp declines in a similar pattern to how the speculative bubble in stocks burst in 2000.
February 27, 2006
Posted by blogger at 2/27/2006