The new home sales data was released and the results are less than stellar. For 2011, there were only 302,000 new home sold nationwide. For perspective, in the South the numbers were the lowest since 1966, and that is the good news. In both the Northeast and the West, sales were the worst in recorded history.
So when you are talking with builders, be kind. They have had a very rough few years.
Purchases of single-family properties decreased 2.2 percent to a 307,000 annual pace, figures from the Commerce Department showed today in Washington. The median forecast in a Bloomberg News survey of economists called for a rate of 321,000 home sales. Last year marked the worst year for the industry in records going back to 1963.
The threat of further price declines may be dissuading some Americans from buying a new home even with mortgage rates near all-time lows and more people finding work. Following a lull in 2011, a wave of foreclosures may hamper the recovery in real estate as more distressed properties are put on the market.
“Builders continue to contend with a number of existing homes that are deeply discounted,” said Anika Khan, an economist at Wells Fargo Securities LLC in Charlotte, North Carolina. “We’re expecting a bit of a pickup in 2012, but we won’t see a meaningful increase as long as new homes are competing with those existing homes.” via Bloomberg
Tom, this is just pretty disturbing. 2011 isn't just the best years for many. Let's just keep out hopes up for this year.
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Things should pick up slightly in 2012. The latest employment numbers look encouraging, and the economy is slowly getting back on track. We’re still a long way off from a full recovery, but I have a feeling that the worst is behind us. That being said, these housing numbers do look dreadful – but what do you expect when you have so many homes in foreclosure. The demand simply isn’t there for new homes right now.
I agree with you Alex. I too believe that the slowly getting better employment numbers will have a positive bearing on the housing market. It will still be a long travel but seeing some light is somehow good enough! Thanks!
We had one buyer look seriously with two builders before deciding on a newer short sale home to purchase. Indeed the price-points on a short sale in good condition are tough to compete with. On the other had we did have one client complete a custom home, and another is now nearing completion. With lot prices as low as they've been building a new home is in reach for more buyers now.
Though the real estate market is getting back to shape, new homes won't have a fight in the market versus foreclosures. The sales Realtors are making are mostly from foreclosed properties.
Building a new house is not practical anymore. There are lots of foreclosed houses which are good as new but at a much affordable price.
There can be so must cost associated with building your home. It's just not practical.
I agree. The data presented in this post is just disturbing. When can we see huge improvement in home sales. I hope soon enough.
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Real estate is surely it is very exciting but the same time we should be very careful before buying our first house.
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