U.S. Government Real Estate Home Sales Slides Down
Monday, February 27 2006 @ 07:58 PM UTC
Contributed by: jron
Signaling a further cooling in the housing market, shares of U.S. home builders fell on Monday after a government report showed new home sales dropped to their lowest level in a year in January as the supply of properties swelled.
Sales of new single-family homes fell 5 percent in January from the prior month, the U.S. Commerce Department said, The U.S. Commerce Department said.
Raymond James and Associates analyst Rick Murray said "I'm kind of skeptical of the number," and added "It would seem to be counter intuitive to show a positive year-over-year comparison." Murray said his checks with builders showed that they believe business has slowed on a year-to-year comparison, also the more worrisome feature is the inventory level, which is "off the charts," Murray said.
Homes under construction and those finished and still unsold rose to 528,000, representing a supply of 5.2 months, the largest inventory since November 1996, that is the number of developed lots.
The 312,000 homes under construction and still unsold accounted for the largest part of the inventory level. Of the total figure, about 118,000 were finished homes.
A wide barometer of home building stock activity, was off 0.71 percent in late morning trading, that is the Dow Jones U.S. Home Construction Index.
Shares of Toll Brothers Inc. were down 71 cents, or 2.13 percent, at $32.63 on the New York Stock Exchange. Shares fell $1.62, or 2.3 percent, to $68.68. Beazer Homes USA Inc. (BZH.N: Quote, Profile, Research) was off 85 cents, or 1.3 percent, at $64.59. Reports said.