sales of new homes plunges - 12 yr. low

http://news.yahoo.com/s/ap/20051223/ap_on_bi_go_ec_fi/economy;_ylt=ApF6kwg6kldRT5MTcw1Bhr7v5rEF;_ylu=X3oDMTBjMHVqMTQ4BHNlYwN5bnN1YmNhdA--


New Home Sales Fall More Than Expected


Sales of new homes plunged in November by the largest amount in nearly 12 years, the most dramatic evidence yet that the booming housing market is starting to cool off.

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In addition to the big plunge in sales, the median price of a new home dropped by 4.1 percent from the October level to $225,200. That was up only 0.3 percent from November 2004, representing a marked slowdown from what been double-digit price gains.

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"Higher energy prices stemming from the hurricane season and fundamental energy supply shortages are clearly having a negative impact on the economy," said David Huether, chief economist for the
National Association of Manufacturers. "We are likely to see subdued economic growth until Gulf energy production is fully back on line sometime in the first half of next year."

(that's a lie)

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crumble

in Arkansas. But what we are seeing is an influx of people from California and other coastal states. I think they are attracted by the cheap prices here and relatively low taxes. But it does worry me that so many spec houses are going up, because although they are built, it is taking a year or longer to sell them--and that is a change. I know this because I work for a company that is invovled in the construction process as a subcontractor, and sometimes it takes forever to be paid for our services.

With the heating costs rising, I predict that McMansions will become a drug on the market.