New-home sales tank in 2011
Despite low interest rates spurring a slight uptick in sales of new homes in November, 2011 could go down as the worst year on record for new single-family dwellings.
The pulse is way down today on news that 2011 is tracking to be the worst year for new-home sales since we began keeping track.
Despite a reported 1.6 percent bump in November new-home sales and all-time-low mortgage interest rates of below 4 percent, economists say the 315,000 new homes that have sold so far in 2011 is less than half the 700,000 that would constitute a healthy housing market.
That’s bad news for more than just realtors working on commission. New-home sales make up only about a tenth of total home sales, but according to the National Association of Home Builders, each new home built creates three jobs and generates around $90,000 in tax revenue. The numbers only track the sale of newly built single-family homes and don’t reflect a recent uptick in the sales of new apartments, according to industry experts.
But if realtors want to avoid setting a second consecutive record for fewest new-home sales in 2011 (last year’s 323,000 new homes sold was the lowest since 1963 when records first started being kept), December sales will have to be the best we’ve seen since the housing bubble burst. And that seems unlikely.