Instant view: New home sales at a record low in February

Reuters News
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Posted: Mar 23, 2011 10:09 AM
Instant view: New home sales at a record low in February

NEW YORK (Reuters) - New U.S. single-family home sales unexpectedly fell in February to hit a record low and prices were the lowest since December 2003, suggesting the housing market slide was deepening.

KEY POINTS: * New U.S. single-family home sales unexpectedly fell in February to hit a record low and prices were the lowest since December 2003, a government report showed on Wednesday, suggesting the housing market slide was deepening. * The Commerce Department said sales dropped 16.9 percent to a seasonally adjusted 250,000 unit annual rate, the lowest since records began in 1963, after an upwardly revised 301,000-unit pace in January. Sales plunged to all-time lows in three of the four regions last month. * Economists polled by Reuters had forecast new home sales edging up to a 290,000-unit pace last month from a previously reported 284,000 unit rate. Compared to February last year sales were down 28 percent.

COMMENTS:

KURT KARL, CHIEF U.S. ECONOMIST, SWISS RE, NEW YORK:

"New home sales were pretty disappointing. It looks like a record low. It's been a disappointing February for home sales and there are no signs of a turnaround. We're going to have a continuing slowdown in the next few months, but people will start to feel better in the second half of the year and construction and sales should do better later this year and into next year. There's some pent-up demand from household formations. It could be single- or multi-family."

DAVID SLOAN, ECONOMIST, IFR ECONOMICS, A UNIT OF THOMSON

REUTERS:

"With price data also falling sharply the data confirm the housing market remains extremely weak even if February's regional breakdown hints weather played a part, and signals for March are marginally improved. Not only was the monthly total a record low, all 4 regions saw record lows, confirming that the market is weak nationwide."

MARKET REACTION: STOCKS: U.S. stock indexes declined BONDS: U.S. bond prices added modestly to gains. FOREX: The dollar was little changed.