New Home Market in Full Retreat

A January poll of builders across the land shows the market for new homes is continuing to deteriorate. The survey, which was released at the National Association of Home Builders' convention in Las Vegas, found that sales are declining across all price ranges. But the random sample of 417 NAHB members from throughout the country shows that things are growing progressively worse as the price range increases. Half the builders said the market for houses priced under $150,000 is in either substantial or some decline, while 80 percent - four out of five - said the market for houses priced from $250,000 to $1 million - is in full retreat. "Things are getting worse," said Gopal Aluhwalia, NAHB's research guru. The main reason people aren't buying, the builders said, is that they can't sell their current homes. But a substantial number are worried about their jobs (88%) or think prices will decline further (75%). Nearly 70% of the builders said they cut prices in the fourth quarter to move inventory, and nearly three out of five reported making no profit during the period.