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Daily Real Estate News | October 29, 2009 | New-Home Sales Decline
After increasing for five consecutive months, new-home sales declined 3.6 percent in September compared with August to a seasonally adjusted annual rate of 402,000, the Commerce Department reported yesterday.

Sales were down 7.8 percent compared to September 2008.

Most of the decline was in the West and the South, where sales fell 11 percent and 10 percent respectively. These reduction were offset by transactions in the Midwest, where sales jumped 34 percent.

Analysts were surprised by the decline, and some blamed it on the first-time home buyer tax credit, which sucked up customers eager to buy foreclosure bargains. Others said that the new normal for time between signing the sales contract and closing is two months or longer, a reality that could be reflected in these numbers.

"We don't know yet if it's anything more than a blip," says Steven Ricchiuto, an economist for Mizuho Securities USA.

Source: Washington Post, Renae Merle (10/29/2009)