US government figures show that new US single-family home sales unexpectedly fell in February to hit a record low. Prices were the lowest since December 2003, showing that the country's housing market slide was deepening.
The Commerce Department said sales dropped 16.9% to a seasonally adjusted 250,000 unit annual rate, the lowest since records began in 1963, after an upwardly revised 301,000 pace in January. Compared with February last year, sales were down 28%.
Sales plunged to all-time lows in three of the four regions last month. Economists had expected around 290,000 homes.
An oversupply of homes exacerbated by an increasing flood of properties falling into foreclosure is frustrating recovery in the housing market. Data on Monday showed a steep drop in sales of previously owned homes in February, with prices tumbling to a near nine-year low.
The median sales price for a new home plunged 13.9% last month to $202,100, the lowest since December 2003. Compared with February last year, the median price fell 8.9%. Persistent price declines could dampen hopes of a pick-up in sales during spring.
In the face of stiff competition from foreclosed properties, which typically sell well below market value, builders are holding back on new construction.
At February's sales pace, the supply of new homes on the market rose to 8.9 months' worth, the highest since August, from 7.4 months' worth in January.
There were 186,000 new homes available for sale last month, matching January's inventory. That was still the smallest supply of home since 1967.
Despite lean inventories, new home sales are expected to continue to bounce along the bottom for a while until the glut of previously owned homes is whittled down. New home sales account for less than 10% of overall sales.
Separately, the Mortgage Bankers' Association said applications for home loans rebounded 2.7% last week.
