Wednesday, October 12, 2011 / by Nathan Clark
New home sales, which have been slowed by competition with discounted foreclosures and short sales on the market, are typically an indicator of both the housing market and the overall economy. Even with the month-over-month increase, new home sales were still about 1 percent lower than September of last year.
New home sales hit an annual rate of 313,000 in September but remain very sluggish compared to the numbers of the middle of the past decade. At the peak of the real estate boom, for example, new home sales were at an annual rate of 1.4 million.
In many markets, the savings of buying an existing home is just too much for new home construction to overcome.