Construction of new homes in USA fell last month

Wednesday, May 18, 2011

Construction of new homes in USA fell last month

USA property developers broke ground on 10.6 per cent fewer new homes last month compared to the preceding month, suggesting that the market remains fragile.

The Commerce Department said that the adjusted rate fell to 523,000 homes in USA per year, down almost 25 per cent from one year ago and considerably less than the 1.2 million USA homes per year that economists consider a sign of a healthy market.

The residential property construction sector is being weighed down by millions of foreclosures, which are forcing down prices for previously occupied homes, and creating potential bargains for prospective purchasers in the process.

The average price of a resale home in USA was around 34 per cent cheaper than the average price for a new build home.

Property prices have fallen by over 50 per cent across some parts of the country since the peak of the market in early 2007.

According to CoreLogic's March Home Price Index, the average price of a U.S. home depreciated by 1.5% for the month.

However, property prices are rising in some parts of the USA, led by a 7.7 per cent year-on-year hike in West Virginia

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