On Tuesday, the 24th of March 2020, data released from the US Commerce Department had signalled an upcoming holocaust over the US housing market despite a multi-year low mortgage rate, as sales of newly built US single-family houses fell sharply last month after surging intransigently a month earlier, while several analysts had suggested that the US new home sales could witness further slump over the coming months due to the coronavirus pandemic which had been contributing to a higher unemployment rate alongside severe disruptions into the US economic activity.
In point of fact, latest downcast data on US new home sales came forth a day after the leading US lender Morgan Stanley and Goldman Sachs had forecasted that the US economic growth could fall to a 74-year low figure this year amid an abrupt uptick in unemployment rate over the narratives of a lockdown in a majority of US states, which in effect would inflict deeper wound in consumer spending, the lifeblood of US economy alongside the US housing sector, suggested analysts.
Besides, according to the US Commerce Department’s US new home sales data released on Tuesday (March 24th), new home sales in February dropped by 4.4 per cent on a year-on-year basis to 765,000 unit last, while January’s revised new home sales data had reported a nearly 13-year peak of 800,000 units, nonetheless, an analysts’ poll had predicted a decline of 2 per cent in US new house sales in February.
Meanwhile, citing that an ongoing economic stagnation in the United States with severe job losses had dented demands and offset impacts of low mortgage rates, a US economist at Oxford Economics in New York, Gregory Daco said followed by the release of Tuesday’s (March 24th) US Commerce Department data, “We expect new home sales to fall more sharply in March and decline nearly 10% in the second quarter.
Low mortgage rates and pent-up demand will be supportive of housing when a recovery is underway, but severe job losses and damage to household confidence may make a quick bounce back difficult. ”