New-home sales plunged 14.5% month over month to an annualized pace of 384,000 units.
Economists polled by Bloomberg were looking for new-home sales to rise 2.3% month over month to an annualized pace of 450,000 units.
February’s numbers were revised down to reflect a 4.5% fall to 449,000 units.
The median sales price was $290,000. The seasonally adjusted estimate of new houses for sale at the end of March was 193,000. The months’ supply hit a 30-month high of six at the current sales pace. Inventory is up from a 5-month supply in February, and a 4.2-month supply a year ago.
The regional breakdown wasn’t pretty, with every region showing a monthly decline, except for the Northeast:
- In the Midwest, new-home sales were down 21.5% on the month and 17.7% on the year.
- In the South, they were down 14.4% on the month and 3.8% on the year.
- In the West, they were down 16.7% on the month and 27.9% on the year.
- In the Northeast, they were up 12.5% on the month and 13.3% on the year.
Bloomberg economist Michael McDonough tweeted this chart showing the trajectory of regional home sales.
Housing starts disappointed in March, but as the weather warms up, some economists expect housing starts to rebound in the spring.
But Millan Mulraine at TD Securities thinks this report was a “bitter pill” for everyone including themselves, that was expecting a spring rebound. “While some weakening in March may not have been out of the ordinary, given the high level of accumulate snow on the ground in a number of states, the softening on almost all fronts suggests that the housing sector recovery is continuing to struggle,” Mulraine said.
“And the weak performance in March points to a softening in momentum that may have gone beyond weather factors. Notwithstanding this, we continue to expect the housing recovery to begin gathering steam in the coming months as the overall economy regains some much needed momentum.”
Meanwhile, Ian Shepherdson at Pantheon Macroeconomics thinks the “housing market has stalled and won’t contribute to GDP growth this year.”
[by Mamta Badkar, writing for BUSINESS INSIDER]
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NORM ‘n’ AL, Minneapolis