New Home Sales Rise in November
The US Commerce Department released its monthly report on new home sales Thursday, showing a pickup in the measure, though not significant enough to indicate a turnaround in housing. The report showed new home sales rose 5.5 percent in November to a seasonally adjusted annual rate of 290,000 units. That number, while an improvement over October, is still less than half of the rate that economists view as indicative of a healthy market.
Many economists believe it could take three years for the devastated US housing market to return to a so-called healthy pace of 600,000 new homes sold per year. The median price for homes sold in November fell to $213,000, 2.7 percent below year-ago levels.
Slower home sales generally translate to fewer jobs in the construction industry, a key driver of economic recovery. On average, every new home built generates the equivalent of three jobs for a year and generates about $90,000 in taxes, according to estimates from the National Association of Home Builders.
The National Association of Realtors had reported on Wednesday that sales of existing US homes had risen to an annual pace of 4.68 million units in November. Yet economists still forecast that 2010 will end up as the worst year in that market since 1997.
New home sales in November fell appreciably in the Northeast, with a drop of 26.7 percent. The Midwest saw a more modest decline of 13.2 percent, while the West saw an increase of 37.3 percent in sales and the South saw a gain of 5.8 percent.