Wednesday, March 25, 2009

Census Bureau Releases New Home Sales Numbers for February 2009

The Census Bureau today released the data for single family new home sales during February 2009. January 2009, was the single worst month for home sales since the CB began keeping records in 1963.

The "good" news is that (as one might expect) there was a slight rise in sales--4.7%-- from January 09 to February 09. The bad news is that this is a 41.1% decline in February 2009 from February 08. As January 2009 was the worst January on record, now February 2009 is the worst February on record. There were 12.2 months of inventory on hand.

New home data does not include condos; therefore, areas with higher condo construction (or conversions from apartments to condos) will have higher inventories.

Locally, a search of the MLS indicated that there are currently 110 single family homes on the market, built between 2007 and 2009. This search did not include "proposed" construction; otherwise, the number would be higher.

And there are some "older" properties, new construction built in '05 or '06 that have never sold; they're rentals or still available as well; but not included in this number.

The number of "new" properties built between 2007 and 2009 for sale rises to 316 when you combine condos and attached townhouses. Again, we did not use "proposed" properties during this search.

We don't have the data about how much "new home" sales have dropped off YOY in this area. (Perhaps somebody will add the number in comments; perhaps not). Clearly, the YOY declines in general have been significant:
  • 59% in Cville, 49% Albemarle for single family homes;
  • +/-29% in Cville and Albemarle when the numbers of single family homes, condos, and townhouses are combined
And that Biscuit Run has been put "on hold," Belvedere, Waterhouse, and other projects are "stalled;" and builders have faced personal ruin and their companies have faced mass foreclosure all indicate how slow the market has been, if the massive inventory itself weren't enough to do this.

Nowhere for sales to go but up. And nowhere for prices to go but down, in order to clear out the overbuilt inventory.

Here's David Crowe, Chief Economist of the National Association of Homebuilders. Refreshingly candid and honest answers to the hard questions:

Related Reading:
New Home Sales - Calculated Risk
New Home Sales Numbers - Housing Wire
Will the local Economy Stop Construction? Rachana Dixit, Aug. 08, DP
Waterhouse Project Scaled Back - Chiara Canzi, Cville Weekly
Biscuit Run on Hold - Real C'ville
2008 Construction Down in Albemarle - Real C'ville
Feb. Nat'l Existing Home Sales Fall & Some Local #'s - Real C'ville
Median Home Prices in Cville, Alb, 20 Cities - Real C'ville

1 comment:

Anonymous said...

WTF. An industry professional who's not lying out his A$$????

What's next??? Realistic prices here in Nirvana???