The Wood and Fiber Supply Chain Experts
The Housing Update
From the May 2009 Forest2Mill newsletter.
According to the U.S. Census Bureau and the U.S. Department of
Housing and Urban Development, new residential sales dropped only 0.6 percent in March, though that
is 30.6 percent below the March 2008 estimate. Still, the news could be much worse. Inventory
levels dropped from an 11.2 month supply in February to a 10.7 month supply in March. For context,
January's inventory level was 12.5 months. The median sales, price for new homes was down $7,300 to
$201,400, while average sales price was up slightly to $258,000.
Existing home sales also resisted steep declines this month. According to the National
Association of Realtors, March sales declined 3 percent from February, a 7.1 percent year-over-year
decline. Inventory increased slightly, up from 9.7 in February to 9.8 months in March, and a drop
of 2 percent from the 10 months we experienced in March 2008. Prices for existing homes rose in
March, up to $175,200, a $7,000 increase from February. Year over year, prices have fallen from
$200,100, a 12.4 percent drop from March 2008.
Standard and Poor’s Case-Shiller Home Price Index suggests that price declines are
moderating as well. According to the index, single family homes in 20 major metropolitan areas saw
a year-over-year decline of 18.6 percent in February, a slight improvement from January’s number,
which was off 19 percent year over year.
New residential construction statistics for March continued to look bleak, according to the
U.S. Census Bureau and the U.S. Department of Housing and Urban Development. Housing starts dropped
nearly 11 percent from February, down to 510,000. This is almost half the number of starts we saw
in March 2008. Building permits were down 9 percent in March to 564,000. This figure is 45 percent
of last year’s number. These numbers, which ate up all of February’s gains, prove that one month
doesn’t make a trend.