Housing soft but stabilizing
David Perry -- Furniture Today, March 30, 2007
Washington -- The broad U.S. housing market continued along an erratic course during February, with sales of existing homes and housing starts showing signs of stabilizing, but the market for costly new homes unexpectedly losing ground.
In a solid shot of good news, sales of existing homes, which account for almost three-fourths of the nation's housing activity, improved for a third straight month, rising by 3.9% to a seasonally adjusted level of 6.7 million units. After bottoming out last fall, sales have risen by 7.4% from a 13-month low of 6.2 million units last September, theNational Association of Realtors reported.
But even with the recent rise, re-sales are still off 5.5% from the relatively recent high of 7.1 million units recorded in 2005 before the housing bubble started to leak.
Housing starts, a fter falling by more than 14% in January, rebound ed 9.0% to a seasonally adjusted level of 1.5 million units from 1.4 million in January. But all that could change again in March if builders develop cold feet after an unexpected slide in new home sales during February. Sales of costly new homes, a volatile market subject to wide monthly swings, fell by 3.9%, to a seasonally adjusted level of 848,000 units, short-circuiting widespread forecasts for an increase after following a 16% plunge in January.
By far the hardest hit segment of the market, new home sales have now skidded down by 24.4% from a 13-month high of 1.1 million units last May.
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