Buy a house. If you have a house, buy land. Pay for the land with
city jobs, prepare your family for a rural lifestyle, accumulate
tools and skills. When the land is free of debt sell the city house
and go make a good life.
-Gene GeRue
WASHINGTON -- After offering incentives ranging from fancy kitchen
upgrades to free swimming pools to move a glut of unsold homes,
builders finally decided they needed to get serious about cutting prices.
The result was the biggest decline in median new home prices in 35
years. And analysts are predicting more price cuts to come for both
new and existing homes as sellers deal with near-record levels of
unsold dwellings.
The Commerce Department reported Thursday that the median price for a
new home sold in September was $217,100, a decline of 9.7 percent
from September 2005.
That was the lowest median home price in two years and the sharpest
year-over-year decline since December 1970, providing dramatic
evidence of the slowdown in the once-booming housing market.
The median price is the middle point, where half sell for more and
half sell for less.
The price decline for new homes followed a report Wednesday that
prices in the much bigger existing home sales market also dropped on
a year-over-year basis in September by 2.5 percent, the largest
decline in records going back nearly four decades.
The price decline for new homes in September came while the sales
pace picked up, rising by 5.3 percent to a seasonally adjusted annual
rate 1.075 million homes.
It was the second consecutive increase in sales after three months of
declines. But even with the improvement, sales activity is down 14.2
percent from a year ago