Wednesday, January 21, 2009

Home Builders' Confidence Keeps Eroding

The National Association of Home Builders released results of a monthly survey of builders' thoughts on market prospects. Its January index for sales of new, single-family homes fell to 8 from 9 in December.

The reading of builder confidence this month marks a new record low.

The latest government data show new-home sales dropped by 2.9% to 407,000 in November. Year-over-year, sales were 35.3% lower. People aren't buying because of the recession and because prices keep falling. Receding demand is keeping supplies high, discouraging construction. Housing starts in December decreased 18.9% to a seasonally adjusted 625,000 annual rate compared to the prior month.  

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