US March sales of new one-family homes drop 7%, third monthly fall

24 April 2012 16:26  [Source: ICIS news]

WASHINGTON (ICIS)--US sales of new single-family homes fell by 7.1% in March from February, the Commerce Department said on Tuesday, the third straight month of declines in what appears to be an accelerating downturn.

In its monthly report, the department said that sales of new one-family homes in March were at a seasonally adjusted annual pace of 328,000 units, down from the upwardly revised February figure of 353,000.

The 7.1% decline in March followed a 1.6% drop in February and the 0.9% slip in January.

The three-month run of declining new home sales has nearly reversed an upward trend that had been developing in the last four months of 2011.

The housing market is a key downstream consumer sector for the chemicals industry, driving demand for a wide variety of chemicals and chemicals-based products such as plastic pipe, insulation, paints and coatings, adhesives and synthetic fibres, among many others.

The American Chemistry Council (ACC) estimates that each new home built represents some $15,000 (€11,400) worth of chemicals and derivatives used in the structure or in production of component materials.

Nationwide, the March decline in new home sales was varied.

Sales of new one-family homes rose by 7.7% in the Northeast and 3.1% in the South, the department said. However, those gains were more than offset by a sharp 27% drop in the West and a 20% decline in the Midwest.

The third straight month of new home sales declines comes in the wake of other recent negative news from the nation’s housing sector, which saw new home construction fall nearly 6% in March as contractors reported lower expectations for the market going forward.

Sales of existing homes also declined in March from February, falling by 2.6%.

($1 = €0.76)

Paul Hodges studies key influences shaping the chemical industry in Chemicals and the Economy

By: Joe Kamalick
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