Existing-home sales fall again in March
According to the National Association of Realtors (NAR), sales of existing homes fell another 2 percent in March to a seasonally adjusted annual rate of 4.93 million units from 5.03 million units last month. That number is 19.3 percent below the 6.11 million-unit pace of March 2007, according to the trade group.
Arise in condo sales in March was offset by a drop in single-family sales. Regionally, sales rose in the Northeast and West but fell in the Midwest and South.
Lawrence Yun, NAR chief economist, said the market is performing “unevenly.”
“Though mortgage rates are at historically low levels, some borrowers are facing restrictive lending practices in declining markets,” he said. “At the same time, many buyers continue to bide their time with a large number of homes to choose from, while other potential buyers remain on the sidelines.”
The national median existing-home price for all housing types was $200,700 in March, down 7.7 percent from a year ago when the median was $217,400. Because the slowdown in sales from a year ago is greater in high-cost areas, there is a downward pull to the national median with relatively higher sales activity in low-cost markets.
Amix of market conditions continues around the country, but areas still showing price gains include Des Moines, Iowa; Austin, Texas; and Durham, N.C.
According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage rose to 5.97 percent in March from 5.92 percent in February; the rate was 6.16 percent in March 2007.
Total housing inventory rose 1 percent at the end of March to 4.06 million existing homes available for sale, which represents a 9.9-month supply at the current sales pace, up from a 9.6-month supply in February.
Single-family home sales fell 2.7 percent to a seasonally adjusted annual rate of 4.35 million in March from 4.47 million in February, and are 18.4 percent below the 5.33 million-unit pace in March 2007. The median existing single-family home price was $198,200 in March, down 8.3 percent from a year ago.
Existing condominium and co-op sales rose 3.6 percent to a seasonally adjusted annual rate of 580,000 units in March from 560,000 in February, but are 25.5 percent below the 779,000-unit level a year ago. The median existing condo price was $219,400 in March, which is 2.8 percent lower than March 2007.
Regionally, existing-home sales in the Northeast rose 2.2 percent to an annual pace of 910,000 in March, but are 18.8 percent below March 2007. The median price in the Northeast was $284,300, up 4.6 percent from a year ago.
Existing-home sales in the West rose 2.2 percent in March to a level of 940,000 but are 22.3 percent below a year ago. The median price in the West was $285,100, which is 14.7 percent lower than March 2007.
In the South, existing-home sales fell 3.5 percent to an annual rate of 1.92 million in March and are 20.0 percent below March 2007. The median price in the South was $167,200, down 7.1 percent from a year ago.
Existing-home sales in the Midwest dropped 6.5 percent to an annual rate of 1.16 million in March, and are 15.9 percent below a year ago. The median price in the Midwest was $152,600, down 5.3 percent from March 2007.
Hardware Technology Forum focuses on EDI, data synch
Memphis, Tenn. While data synchronization has become the new reality for many manufacturers, this year’s Hardlines Technology Forum (HTF) did not overlook Electronic Data Interchange (EDI), the backbone of ordering and billing between retailers and their suppliers. Sessions looked at EDI’s increased use in transportation, the roles played by various EDI documents, and in today’s final presentation, the changing nature of the EDI coordinator’s job.
EDI also surfaced during the Retail Panel, a conference highlight where retailers and distributors discuss their upcoming IT initiatives. There were no major announcements this year, however, as the buyers in the home channel seem to have their hands full with projects they’ve already started.
Approximately 225 people attended the four-day conference, held April 21 to 24 at the Peabody Hotel. Technology vendors peddled everything from EDI outsourcing to data encryption to help with U.S. Customs requirements.
During the two-hour Retail Panel, representatives from Orgill, Lowe’s, Do it Best and True Value answered pre-submitted questions from the audience. Some of the inquiries sounded like repeats from the previous day’s “Seller’s Forum,” where vendors complained about fines and “scorecards” that give them little feedback on what they’re doing wrong.
Brett Hammers, vp-marketing for Orgill, said his organization prefers to works one-on-one with problem vendors. “We don’t just put information out there,” he said. “It’s in our best interest to handle [feedback] strategically rather than globally.”
Greg Linder, director of supply chain operations for True Value, spoke of a visible supply chain solution the co-op is rolling out, through Sterling Commerce, that will result in more consistent lead times for incoming products. True Value is not planning to implement data synchronization anytime soon, he said, adding: “You can synch all the data in the world, but it’s [data] accuracy that keeps us up at night.”
Lowe’s, on the other hand, implemented data synchronization with most of its vendors and has moved on to a marketing data pool initiative. Last year the North Carolina retailer began collecting images and data for Lowes.com and in-store use through Big Hammer, a division of EdgeNet. The retailer is doing the project in phases, with the three categories, lumber, rough electrical and rough plumbing, set to be completed by the end of 2008.
Sales down at Lennox International
HVAC manufacturer Lennox International said earnings fell 26.7 percent in the first quarter, to $6.3 million from $8.6 million in the same period last year. Sales also fell, down 3 percent to $767.1 million from $791.5 million in the first quarter of 2007.
Like many other manufacturers of building materials and other large purchase items, Lennox’s earnings suffered from softness in the housing sector.
“As expected, difficult residential new construction and replacement markets challenged our first-quarter results,” said Todd Bluedorn, CEO of Lennox International. “Disciplined cost reductions, combined with strong performance in our North America Commercial and Refrigeration businesses, helped offset the headwinds.
Bluedorn also said the company is revising its projected full-year revenue expectations because of the downturn in the housing market. The company expects revenue to stay flat compared with last year or rise by up to 2 percent. Initial projections pegged year-end revenue growth of 2 percent to 5 percent.
Of its four business segments, the company saw revenue growth in commercial heating and cooling — up 2 percent — and refrigeration. Revenue from installed services and residential heating and cooling fell in the quarter.