New Home Sales Slip From Last Year's Record High
February 28, 2002
WASHINGTON, Feb. 27- After an exceptionally strong performance in the final three months of 2001, sales of new homes retreated nearly 15 percent in January to a seasonally adjusted annual rate of 823,000 units, the Census Department reported today.
"We're seeing things slow down from what had been an extraordinary sales pace at the end of last year," said Gary Garczynski, president of the National Association of Home Builders (NAHB) and a builder/developer from Woodbridge, Va. "Even so, there is no indication of fundamental weakness in the market, and higher numbers in February could substantially offset this latest decline."
Garczynski noted that the Census Department revised its numbers significantly upward for new home sales in October, November and December of 2001 in its latest report, and that December's revised 966,000-unit pace was particularly strong. The numbers confirm that new home sales hit a record one-year high of 906,000 units - up from what had already been reported as a record 900,000 units - in 2001.
Sales of new homes slid downward in three out of four regions in January. The South and West posted double-digit declines of 22.1 percent and 17 percent, respectively, while the Midwest registered a modest 0.6 percent drop and the Northeast reported a healthy 9 percent gain. Meanwhile, the seasonally adjusted inventory of new homes for sale inched up a single percent in January to 310,000 units - still relatively low by historic standards.
"Our latest surveys had indicated some retrenchment in builder expectations following the rebound our industry experienced from the effects of Sept. 11," Garczynski said. "Things are likely to smooth out in the year ahead, however, and NAHB is forecasting that total new home sales in 2002 will about equal 2001's record-setting pace of 906,000."
Source: National Association of Home Builders