New Home Sales Down 26% in 2007

The New York Times is reporting that sales of new homes fell by 26% last year.  This is the biggest drop since the US government began keeping records in 1963.

Prices are also declining.  The December median new home price declined 10.9% from a year ago, to $219,200.  For the full year, new homes did manage to squeak out a 0.2 gain.

Despite the declines in prices, supply continues to far outweigh demand.  The current backlog of new homes is 9.6 months, per The Commerce Department.

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