WASHINGTON – New-home sales nationwide fell last month to the lowest level in 17 years, in their eighth consecutive monthly decline, according to the joint report released today by the U.S. Census Bureau and the U.S. Department of Housing and Urban Development.

Sales of new single-family homes plunged to a seasonally adjusted annual rate of 526,000, a decline of 8.5 percent from February’s revised 575,000 units per year and 36.6 percent from March 2007’s 830,000 units per year.

Analysts had projected a March sales pace of 580,000 units per year, based on a Bloomberg News survey of 75 economists, a level that would have been 1.7 percent below the government’s original February estimate of 590,000 units per year. (The economists’ estimates ranged from 560,000 to 602,000 units per year.)

Prices also fell, with the median price of single-family homes sold in March hitting $227,600, a 6.8-percent decline from February’s $244,100. Compared with the year-ago median of $262,600, prices fell 13.3 percent, in what Bloomberg said was the biggest year-over-year drop since July 1990.

The number of new homes for sale at the end of the month fell to a two-and-a-half-year low of 468,000, a decline of 1.1 percent from February and 14.6 percent from a year ago. At the current diminished sales pace, however, that amounted to an 11-month supply – the highest since September 1981 – up from 10.2 months in February and 8.3 months at the end of March 2007.

“This blows away any hope that things are stabilizing in housing,” Michael Feroli, an economist at JPMorgan Chase & Co. in New York, told Bloomberg News. “It’s a negative for growth and for the economy, and it’s going to persist into the second half of the year.”

Existing-home sales – registered when a sale closes, usually a month or two later – fell last month despite increases in the Northeast and the West, the National Association of Realtors said in a separate report this week. (READ MORE)

New-home sales, about 15 percent of the housing market, are considered a leading indicator because they are registered at the time a contract is signed. They fell last month in every region, the Census Bureau said.

The Northeast led the decline, with sales of new single-family homes plunging in March to a seasonally adjusted rate of 29,000 per year. That represented a decline of 19.4 percent from February and 64.6 percent from a year ago.

The region’s inventory of new houses was 45,000 at the end of March, unchanged from a month earlier but down 13.5 percent from the Northeast’s year-ago inventory of 52,000 homes.

Additional information, including the full New Residential Sales report, is available from the U.S. Commerce Department’s Bureau of the Census at www.census.gov/newhomesales.