Providing further evidence that housing is helping lift
the economy out of recession, the Commerce Department reported today that
sales of newly built single-family homes rose 5.3 percent in February to a
seasonally adjusted annual rate of 875,000 units. This increase comes on the
heels of a shortfall in January that followed exceptionally strong sales at
the end of 2001. The February sales number represents a healthy and
sustainable level of activity.
"Rejuvenating consumer confidence and very favorable interest rates on home
mortgages have been generating solid buyer demand, as housing continues
adding fuel to the economic recovery," said Gary Garczynski, NAHB president
and a builder/developer from Woodbridge, Va. "New-home buyers are now
taking the plunge at about the same rate they were just prior to the attacks
on America, and buyer demand should continue trending upward from here. It's
now virtually certain that housing, which represents about 14 percent of
national Gross Domestic Product, will make a solid, positive contribution to
economic growth in this year's first quarter."
NAHB forecasts indicate that total new home sales in 2002 should nearly
equal 2001's record-setting sales of 906,000 units. "Each of these sales
will generate an average of $8,900 in local spending by new owners on
home-related goods and services in the first year those homes are occupied.
And every 100 newly built homes will generate $11.6 million in new income to
local businesses and workers, 250 jobs in the local community and another
$1.4 million in local government revenues within the first year of
construction alone," Garczynski noted. "All together, that's a significant
boost for local economies."
Regional home sales patterns have been fluctuating quite a bit in recent
months. In February, the Northeast and Midwest reported declines of 10.1
percent and 0.6 percent, respectively, and the South and West posted
respective gains of 9.9 percent and 6.7 percent.
"Builders are keeping a tight rein on for-sale inventories - another
indication of sustainable strength in the housing market," Garczynski noted.
The inventory of new homes for sale rose a single percent in February to a
healthy 313,000 units, while the months' supply of homes for sale at the
current rate dropped back slightly, from 4.5 to 4.3.
Published: April 1, 2002
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