Sales of newly built homes unexpectedly plummeted in January to their lowest level in nearly five decades, providing more evidence of the housing market’s fragility.
Purchases of new single-family homes dropped 11.2 percent in January from December to a seasonally adjusted annual rate of 309,000, the Commerce Department reported Wednesday. Sales fell in every region except the Midwest, and the raw number of new homes on the market rose for the first time in nearly three years.
"No sugarcoating these numbers," Mike Larson, an analyst at Weiss Research, wrote in a note to clients. "They stink."
The figures are the latest in a string of mixed indicators about the housing market’s health and renew questions about whether the federal government should follow through on its plans to soon end initiatives aimed at stimulating sales. Those efforts include a Federal Reserve program that helped pull down interest rates and a tax credit for first-time buyers and others.
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