Wednesday, February 24, 2010

New Home Sales Drop In January

Sales of newly built single-family homes in the United States unexpectedly fell to a record low in January, according to government data on Wednesday that hinted at potential trouble for the fragile housing market recovery.

The Commerce Department said sales dropped 11.2 percent to a 309,000 unit annual rate, the lowest level since records started in January 1963, from an upwardly revised 348,000 in December.
Who was not expecting this particularly when the weather through much of the Eastern United States contributed several major blizzards during the December and January period? A mild upward revision in December is more than offset by a huge decline in January.

What reason was provided in the AP report? None.

However, the WSJ provides more details and as I suspected, it was likely weather related.
Regionally, January new-home sales dropped 35.1% in the Northeast, 11.9% in the West, and 9.5% in the South. Sales rose 2.1% in the Midwest.
Better weather may result in better sales figures going forward, but there continues to be weakness in the marketplace.

It would seem that we need new experts if they keep getting unexpected results. Someone is seriously misjudging the economy if we continually see unexpected results - usually to the downside.

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