Government data to be released Wednesday is forecast to show that new home sales fell for the fourth straight month February, providing more evidence that the housing market has yet to bottom out.
The Commerce Department is expected to report that new home sales dipped 2.2 percent in February from a month earlier to a seasonally adjusted annual rate of 575,000 units, according to the consensus forecast of Wall Street economists surveyed by Thomson/IFR.
The report is scheduled to be released at 10 a.m. EDT. A month ago, the government reported new home sales fell 2.8 percent to 588,000 in January from December's revised rate of 605,000 homes. Sales in January were down nearly 34 percent from a year earlier.
Builders such as Centex Corp., Pulte Homes Inc. and Hovnanian Enterprises Inc. were caught with a glut of unsold properties over the past year when mortgages became harder to get and sales slowed. Builders have slashed prices, but many buyers have stayed on the sidelines because they're having trouble getting mortgages and believe prices will keep falling.
That belief was bolstered by two reports released Tuesday. The Standard & Poor's/Case-Shiller home price index for 20 large U.S. cities fell 10.7 percent in January from a year earlier, while prices in S&P's 10-city index fell a record 11.4 percent.
A separate report, released by the Office of Federal Housing Enterprise Oversight, said home prices fell 3 percent in January from the same month last year. That index includes a broader swath of the U.S., but only includes home loans of $417,000 or less that can be sold to mortgage finance companies Fannie Mae and Freddie Mac.
While sales of existing homes notched a surprise increase in February after falling for six straight months, the median price fell, according to the National Association of Realtors.
The trade group said Monday sales rose 2.9 percent last month to a seasonally adjusted annual rate of 5.03 million units _ the biggest increase in a year. But the median existing sales price in February fell to $195,900, the largest year-over-year drop on records that go back to 1999.
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