New home sales in the New Normal are almost redundant. The markets have written off any construction resurgence for the short and medium term. And according to the US Census, new home sales were lower in January 2011 than most people have seen in their life times.
Sales of new single-family houses in January 2011 were at a seasonally adjusted annual rate of 284,000, according to estimates released jointly today by the U.S. Census Bureau and the Department of Housing and Urban Development.
This is 12.6 percent (±11.2%) below the revised December rate of 325,000 and is 18.6 percent (±15.4%) below the January 2010 estimate of 349,000. The median sales price of new houses sold in January 2011 was $230,600; the average sales price was $260,300. The seasonally adjusted estimate of new houses for sale at the end of January was 188,000. This represents a supply of 7.9 months at the current sales rate.
Since the housing crisis began in 2006, the only semblance of life shown in this index is when the government offered first time home buyers incentives. In a report this week by the Congressional Budget Office (CBO) on the 2009 Stimulus, the CBO believed the economic multipliers for the first time home buyers tax credit was between 0.3 and 0.8.
In plain English, 20% to 70% of the money used on this program was a waste to the economy.
NAR Says Home Sales Up – Do We Believe It? by Steven Hansen
Mortgage Applications Down – This May Be An Irrelevant Statistic by Steven Hansen