New home sales up in September
Sales of newly built single-family homes rose 2.7 percent in September to a seasonally adjusted annual rate of 464,000 units, according to U.S. Commerce Department numbers released Oct. 27.
The report also indicated that builders are making substantial progress in reducing the months’ supply of unsold units on the market.
“It’s great to see some upward movement in new home sales, particularly in light of the strong efforts that home builders have been making to bring supply and demand back into balance by limiting new construction and offering substantial price- and non-price incentives on already-built units,” said National Association of Home Builders chairman Sandy Dunn, a home builder from Point Pleasant, W.Va.
NAHB chief economist David Seiders said the gain followed a downward revision for August and was almost entirely concentrated in the West region, where sales bounced back from a very low level in August.
“The fact is that housing demand remains fundamentally weak, and the housing contraction continues to weigh heavily on the financial markets and the overall economy,” Seiders said. “Without question, an additional economic stimulus package — including substantial measures to spur home buying and limit foreclosures — is necessary to support home prices, stabilize financial markets and limit the severity of recession.”
The number of new homes for sale shrank to 394,000 units in September, down from 425,000 units in August. At the current sales pace, there was a 10.4 months’ supply of unsold new units on the market, versus an 11.4 months’ supply in August.
Regionally, sales activity gained 22.7 percent in the West and 0.7 percent in the South in September, but at the same time declined 21.4 percent in the Northeast and 5.8 percent in the Midwest.
Ace tops customer service survey
Ace Hardware received the highest marks in customer service for the third quarter of 2008, according to RealPeopleRatings.com, a quarterly survey by Corporate Research International (CRI).
True Value ranked second in the survey; Lowe’s ranked third.
CRI, a market research firm specializing in mystery shopping and customer satisfaction surveys, sends the quarterly surveys as online opinion polls to its pool of panelists; 3,000 panelists participated in this quarter’s survey.
According to CRI, this survey emphasizes the importance of brand image and customer perception. Respondents were asked to rate their perception of each business’s customer service on a scale of 1 to 10, with 10 being the highest rating. If a respondent did not have experience with the business, the panelist did not enter a score for that establishment.
“It’s increasingly important in today’s marketplace for companies to ensure a high level of customer satisfaction to keep their customers coming back,” said Michael Mallett, CEO of Corporate Research International.
Black & Decker earnings decline for Q3
Towson, Md.-based Black & Decker reported net earnings of $85.8 million for the third quarter, down 18 percent from $104.6 million for the third quarter of 2007. Earnings reflect a $15.6 million pre-tax restructuring charge.
Sales for the quarter were $1.57 billion, down 4 percent from 1.63 billion in the year-ago period.
“Black & Decker generated solid earnings and cash flow in a very difficult business environment this quarter,” said Nolan D. Archibald, chairman and CEO. “Sales met our expectations despite weakening economic conditions in the U.S. and Western Europe. The actions we took earlier in the year to reduce costs helped our results this quarter, and we are taking additional steps in light of recent macroeconomic developments.”
In the company’s power tools and accessories, hardware and home improvement, and fastening and assembly systems segments, sales decreased 6 percent, 13 percent and 2 percent, respectively.