Update (thank you marketwatch):
Sales were down 18.3%, compared with February 2006. Sales in January were revised lower to show a 15.8% drop to an 882,000 annual rate, compared with the 937,000 reported previously. Reported sales for December and November were also revised lower.
Now here's the lazy AP story as most MSM are going with - the down 3.9% number which is worthless:
Sales of New Homes Fall Sharply for 2nd Consecutive Month in February
WASHINGTON (AP) -- Sales of new homes fell sharply for a second consecutive month in February, a weaker-than-expected performance that dimmed hopes for a rebound in the troubled housing market.
The Commerce Department reported Monday that sales of new single-family homes fell by 3.9 percent last month to a seasonally adjusted annual rate of 848,000, the slowest sales pace in nearly seven years. All regions of the country except the West experienced weakness last month.
The February decline followed an even larger 15.8 percent drop in sales in January, which had been the largest one-month plunge in 13 years. The back-to-back declines provided evidence that the housing market is continuing to struggle with lagging demand and a glut of unsold homes.
The sales decline that has occurred over the past year has left a glut of unsold homes on the market, forcing builders to slash prices and offer a number of incentives to attract buyers.
For February, the number of unsold homes rose by 1.5 percent to 546,000. That meant it would take 8.1 months to sell all of those homes at the February sales pace, up from 7.3 months in January.
The problems in housing are being increased by spreading financial difficulties with mortgage lenders who specialized in the subprime market, where borrowers with weaker credit histories could qualify for mortgages.
The plunge in housing has trimmed overall economic growth and is occurring as part of an effort by the Federal Reserve to raise interest rates as a way of slowing economic activity and keeping inflation under control.