New home sales across the nation increased significantly for the month of December 2010 when compared to the previous month. Even December's positive numbers leave 2010 the worst year on record for new home sales since the housing bubble burst.
According to data released by the Commerce Department on Wednesday January 26, they increased by 17.5% for the month of December when compared to the previous month. That raises the seasonally adjusted annual pace for sales to 329,000. The increase was not nearly enough to make an impact on the horrible sales figures reported earlier in the year.
While December's numbers helped leave the year on a positive note, sales for the rest of the year left 2010 as the year with the worst figures since the housing bubble burst. The U.S. government estimated that sales ended up somewhere around 321,000 for 2010. That figure is the lowest recorded figure dating back to records kept since 1963. Total sales for 2010 were 14.2% lower than the total number of sales made in 2009. While the numbers for December were impressive when compared to previous months, they were still 7.6% lower than sales made in December 2009. Much of last year's sales woes can be attributed to joblessness and the pressure foreclosures are putting on new home sales in the housing market.
The strength of December was motivated by a dramatic increase in sales in the Western part of the U.S. Sales in the Western United States increased by 71.9% during the month of December when compared to the previous month. This surge in sales was driven by an increase in California as buyers rushed to take advantage of a homebuyer tax credit.
The available new home supply dropped to 6.9 months for the month of December. That supply was estimated at around 190,000 units. That shows that the housing market is improving considering that a 6-month supply is considered a healthy place to be for the nation's housing market.
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