Good News for Builders: New Home Inventory Down Again in September

A report in the Oct. 30 Eye on the Economy e-mail newsletter published by the National Association of Home Builders (NAHB), Washington, D.C., said new home inventory in Sept. 2009 was down by more than half to 251,000, the lowest level since November 1982. New home inventories peaked at 572,000 in July 2006. There was a 7.5 months' supply of unsold homes in September, down from an all-time of 12.4 months in January of this year. The inventory has declined by almost 100,000 additional units from the 340,000 new homes on the market in the first month of the year, which in healthier times would have been a near-normal level. NAHB said the fact that the months' supply was running at a somewhat elevated level in September when the inventory was below normal levels clearly indicates that the major problem facing the housing market is no longer oversupply, but weak demand.