Current New Home Sales Strong, Yet Down From Last Year

New home sales, also referred to as housing starts, represent new potential clients for lawn landscape contractors, therefore, April’s growth means good news to contractors, especially for contractors in the southern U.S.

The South continues to be a popular growth area with 744,000 units sold in April, while the West total is just over half of the South’s at 408,000. The Midwest - the only area of the U.S. to experience a loss in sales from March totals - logged in at 280,000 units, while the Northeast sold 177,000 units. (For more details, see the "Recent Housing Starts" sidebar below.)

The Census Bureau breaks down the 1.61 million units into single- and multi-family (townhouses and multi-family apartment buildings) residences. Residential contractors serving single-family residences should be hopeful to find new clients based on unit sales for single-family homes totaling 1.29 million, nearly a 7 percent increase compared to March. Contractors servicing multi-family residences, however, may see a slight drop in potential new clients as sales in this category fell from 379,000 units sold in March to 321,000 in April.

The April housing start numbers also indicate the possibility that low mortgage interest rates prompted by the federal government’s recent interest rate drops are working to keep the economy in check and stave off recession.