New Home Sales Plunge in January (growing glut of unsold homes)

[Herman Munster]

http://www.nytimes.com/2007/03/01/business/01econ.web.html?_r=1&oref=slogin

Builders faced a growing glut of unsold homes in January as the pace of new-home sales slowed 16.6 percent from the month before — the most in 13 years.

Further signs of stress in the housing market were evident today as Home Depot, the world’s largest home improvement chain, issued a pessimistic forecast of lower earnings and sales for the year.

The Commerce Department said today in its monthly report on new home sales that the seasonally adjusted annual sales rate fell to 937,000 last month from 1.1 million in December. Compared with a year earlier, January’s rate was down 20.1 percent.

Since the housing market hit its peak in the summer of 2005, new-home sales have fallen off by nearly a third.

New homes sold for slightly more money in January, with the median price rising to $239,800 from $238,400 in December. Compared with a year earlier, however, prices declined by 2 percent.

[Mr. Ected]

1. I Know. I'm In the Real Estate Business. :-(

Foreclosures are through the roof.

An economy of smoke and mirrors.

[Subdivisions]

2. Could you elaborate, please, for us laypeople? Just how bad is

it and how bad could it get?

[AlCzervik]

3. homebuilders over speculated imo, thats a big part of the problem.