Median sales price off 10.9% in past year, biggest drop since 1970
By Rex Nutting, MarketWatch
WASHINGTON (MarketWatch) — Sales of new U.S. homes unexpectedly surged in
April, rising by 16% to a seasonally adjusted annual rate of 981,000, the Commerce
Department said Thursday.
The annual rate far exceeded the 865,000-home pace that had been expected.
Sales were boosted by plunging prices. The median price of a new home was
$229,100, down 10.9% over the past year, the largest price decline since 1970.
Compared with March, prices in April were down a record 11.1%, likely reflecting
stronger sales of cheaper homes in the South.
The number of homes sold for under $150,000 nearly doubled.
"When you slash prices and pile on the incentives, you move product," wrote
Mike Larson, an analyst at Weiss Research.
It was "a rather astounding report," said David Greenlaw, an economist
for Morgan Stanley. "We’re at a loss to explain this spike in sales in
light of the recent renewed gloominess among homebuilders."
The inventory of unsold homes fell by 1.5% to 538,000, representing a 6.5-month
supply. In March, the inventory was 8.1 months.
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