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October 11, 2008 11:07:59 PM CDT

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New Home Sales Hit 12-Year Low

Posted Jan 28, 08 1:20 PM CST in Business 

(Newser) – Sales of new homes fell to a 12-year low in December, making 2007 the worst year on record for home sales. Economists had predicted November's numbers wouldn't get much worse; instead, sales decreased 4.7% to an annual rate of 604,000, reports Bloomberg. "We are in deep recession lows now in terms of new home sales and housing starts," says an economist.

In response to the Commerce Department numbers out today, homebuilders' stocks fell and the dollar continued its plunge. "The broader economy is very, very close to falling over the edge," said another economist. "The Fed really needs to think aggressively." The median price for a new home fell to $219,200 in December; the 10% drop from a year earlier was the greatest in 37 years.

Source Bloomberg

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A sign outside a new home in St. Louis advertises a sales promotion in this Nov. 29, 2007 file photo. (AP Photo/Jeff Roberson, file)   (Associated Press)
A sign advertising a home for sale is shown in San Carlos, Calif., Thursday, Jan. 17, 2008. (AP Photo/Jeff Chiu)   (Associated Press)
A new home is shown under construction Friday, Dec. 28, 2007 in a Columbus, Ohio subdivision. Sales of new homes plunged to their lowest level in more than 12 years, a grim testament to the problems plaguing...   (Associated Press)
A model home in a new housing development in Olmsted Falls, Ohio is shown Friday, Dec. 28, 2007. (AP Photo/Mark Duncan)   (Associated Press)
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