New-home sales plunged by 9% in November
Twelve-month sales have crashed by more than 34%
By Tom Stundza -- Purchasing, 12/28/2007 11:06:00 AM
Sales of new homes plunged last month to their lowest level in more than 12 years, a grim testament to the problems plaguing the housing sector. The Commerce Department reported Friday that new-home sales tumbled by 9% in November from October to a seasonally adjusted annual rate of 647,000. That was the worst showing since April 1995, when the pace of sales was 621,000. The Associated Press says that over the last 12 months, new-home sales nationwide have tumbled by 34.4%, the biggest annual slide since early 1991, and stark evidence of the painful collapse in the once high-flying housing market.
The National Association of Home Builders (NAHB) housing forecast “shows systematic improvements in home sales by the second quarter of 2008, improvement in housing starts by the third quarter, maintenance of low levels of manufactured home shipments throughout 2008, and modest declines in the real value of residential remodeling next year.” NAHB Chief Economist David Seiders says, in this forecast, that residential fixed investment continues to contract through the first half of 2008 but posts modest growth in the second half of the year."
But, before you put much hope in forecasts for a 2008 rebound in the battered housing market, consider this: A year ago at this time many top economists were looking for that recovery to begin in 2007. “Instead,” writes Chris Isidore, CNNMoney.com senior writer, “the year saw historic declines in nearly every measure of housing strength and home building, and left a trail of predictions from some of the nation's top economists that look—at best—foolish.”
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