Year-to-Year, New Home Sales Drop 23%

New home sales fell 23% in 2009 from the previous year and sales ended the year on a down note with a 7.6% decline in December. Despite the first-time homebuyer tax credit, sales of newly constructed homes totaled only 374,000 in 2009, compared to 485,000 in 2008, according to the U.S. Census Bureau. This year, economists at the National Association of Home Builders expect an improving economy and new homebuyer tax credit will push new home sales up 39% to 517,000. The tax credit, which includes repeat buyers this time, expires April 30. Buyers that sign a sales contract by April 30 have until June 30 to close. NAHB economist Bernard Markstein expects the new tax credit will generate 180,000 additional sales and 40,000 of the sales will involve new homes. Meanwhile, the Census Bureau reported that sales of new single-family homes fell to a 342,000 seasonally adjusted annual rate in December from 370,000 in November. November sales were revised upward. Last month, the bureau reported that sales plunged 11.3% in November to a 355,000 seasonally adjusted annual rate.