Yesterday brought news of exisiting home sales falling to the lowest level in a decade. This morning was new home sales' turn, and the news was hardly better.

New home sales in July fell to the lowest level on record, down 12.4% from June, and 32.4% from July 2009. For those who like viewing this stuff in graphical form, here's a nice chart from the finance blog Calculated Risk:


As was the case with existing sales, the culprit that's slaughtering new sales is the expiration of the first-time homebuyers credit. Pay someone to buy a home, and they'll rush to meet the deadline. All that did was supercharge sales earlier this year by cannibalizing future sales, which is the hangover we're dealing with now.

With new home sales, one risk is that the artificial demand created by the housing credit gave homebuilders like KB Homes (NYSE: KBH) and Lennar (NYSE: LEN) a false sense of hope, leading to a glut of unnecessary construction. Earlier this year, D.R. Horton's (NYSE: DHI) CEO warned that his company would be "focusing on reducing our inventory post March to comply with the expiration of the tax credit."

As scary as these numbers are, don't read too much into them. Yale professor and housing godfather Robert Shiller called yesterday's figure "anomalous" due to the credit's expiration. Last month, when new home sales were much stronger than this month, a quote from the Wall Street Journal summed the situation up nicely: "The last time we were running these kinds of numbers was the 1982-1983 recession, when we had 100 million less people." These numbers are ugly, but hardly sustainable.

Fool contributor Morgan Housel doesn't own shares in any of the companies mentioned in this article. The Fool has a disclosure policy.