In news that could be a blow to those who use construction equipment, the sale of new homes saw a significant drop in January.
According to the U.S. Census Bureau and the Department of Housing and Urban Development, sales of new single-family homes in January declined by 11.2 percent when compared to levels seen the month before. At a seasonally adjusted annual rate, home sales for the first month of the year came in at 309,000.
The decline in home sales comes despite government efforts to encourage people to buy new homes. A tax credit for first-time buyers was extended beyond its original November deadline to last until April.
Through the tax credit, first-time buyers can get $8,000 for the purchase of their first home. The credit was also expanded to include repeat buyers and offers them a $6,500 incentive.
While sales went down, another recent report shows that housing starts and building permits for single-family homes increased in January. Given a lack of sales, however, builders may find that construction efforts may be for naught.