NEW YORK - March 23, 2011 - Sales of new single-family homes collapsed in February, the Commerce Department reported Wednesday, as a combination of high unemployment, tumbling prices and a glut of cheaper alternatives brought activity to a near-standstill.|

New-home sales fell 16.9% to a seasonally adjusted annual rate of 250,000 in February, though January’s figures were revised higher to 301,000 from 284,000. Compared to February 2010, sales collapsed by 28%.

Every region but the west saw record lows, and in the northeast, sales dropped by 50% compared to year-earlier levels.

“The housing market has literally collapsed,” said Tony Sanders, a real estate finance professor at George Mason University. “We’re stuck; it’s not going to revive in the spring and may not in the summer.”

U.S. stocks dropped, though not massively, after the report’s release.

Economists polled by MarketWatch had expected a slight rise to a 290,000 rate in February. While inclement weather may have played a role in the particularly poor showing during the month - the particularly nasty dive in the northeast and midwest lends support to such a view - analysts said the figures were reflective of a basically dead market.

“The details of the new-home sales release clearly indicate that the housing market remains incredibly soft,” said David Resler, chief economist of Nomura Securities International.