Home sales softened in January, according to business contacts and recent data releases. Home sales continued to weaken from highs set in November but remained even with or slightly ahead of year-earlier levels. Existing home inventories rose slightly from December while new home inventories edged down. Contacts continued to report downward pressure on home prices, and builders in particular reported that competing against foreclosed homes remained difficult. Construction remained at low levels across much of the District. The outlook among Realtors for sales over the next three months remained positive on a year-over-year basis, while builders expected more modest improvements.
Commercial development remained weak across the District. However, reports from contractors and recent data releases indicate that activity has stabilized at low levels. Commercial construction is expected to remain generally flat this year.