New Home Sales Plummet to Record Low
Luke Mullins
Home sales activity plummeted in May, as a key housing stimulus was removed from the market.
Sales of new homes fell by 33 percent in May from April to the lowest level ever recorded, the
[Check out 10 Cities for Retirement Property Steals.]
The sluggish sales worked to increase the months' supply of unsold homes -- a key inventory yardstick -- to 8.5. That's up sharply from 5.8 in the previous month. Meanwhile, the median price of a new home fell 10 percent, to
Economists had expected to see a significant pullback in sales following the
The tax credit offered up to
[Check out Homebuyer Tax Credit Closing Deadline May Be Extended]
"To qualify, people had to sign contracts by
Home sales could remain depressed in the coming months as demand reformulates. "The next few months are likely to be very grim," Shepherdson said. But even without the tax credit, would-be buyers will have tempting reasons to get into the market. Home prices have fallen precipitously from the peaks they reached during the housing boom. Meanwhile, 30-year fixed mortgage rates stood at 4.75 percent for the week ending
But
Even as sales declined, the report found that the number of unsold new homes on the market dropped by 1,000 to 213,000. "The lowest level since 1970,"
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Real Estate - New Home Sales Plummet to Record Low
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