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Sales of existing homes rose in January,
reaching the highest level in seven months, according to the NATIONAL
ASSOCIATION OF REALTORS®.
Total existing-home sales — including
single family, townhomes, condominiums, and co-ops — increased 3
percent to a seasonally adjusted annual rate of 6.46 million units in
January from an upwardly revised pace of 6.27 million in December.
Sales were 4.3 percent below the 6.75 million-unit level in January
2006.
David Lereah, NAR’s chief economist, says
observers shouldn’t overreact to the sales gain or to other short-term
effects. “Although we’re expecting existing-home sales to gradually
rise this year, and buyers are responding to the price correction, some
unusually warm weather helped boost sales in January,” he says. “On the
flip side, the winter storms that disrupted so much of the country in
February could negatively impact the housing market.
“Although the data is seasonally adjusted,
these weather events are unusually large — many transaction closings
were postponed in February, and home shopping was essentially shut down
for about a week in many areas,” he says. “We shouldn’t be surprised to
see a near-term sales dip, but that will be followed by a continuing
recovery in home sales.”
Inventories Drop
Total housing inventory levels rose 2.9
percent at the end of January to 3.55 million existing homes available
for sale, which represents a 6.6-month supply at the current sales pace
— unchanged from the revised December level. Supplies peaked at 7.4
months in October 2006.
“Inventories are looking better, but price
softness should continue until spring when the market is expected to
become more balanced,” Lereah says.
What Happened Regionally
Here’s a breakdown of home sales by region:
- West Coast:
Existing-home sales in the West rose 5.6 percent to an annual pace of
1.32 million in January but were 9.6 percent lower than a year ago. The
median price in the West was $321,300, down 4.6 percent from January
2006.
- Midwest:
Existing-home sales increased 4.8 percent in January to a level of 1.53
million, and were 0.6 percent lower than January 2006. The median price
in the Midwest was $162,600, which is 3.5 percent below a year ago.
- South:
Existing-home sales in the South rose 2 percent to an annual sales rate
of 2.54 million in January, but were 7.3 percent below a year ago. The
median price in the South was $174,600, which is 1.7 percent below
January 2006.
- Northeast:
Existing-home sales in the Northeast were at a level of 1.07 million in
January, unchanged from December, and were 5.9 percent higher than
January 2006. The median existing-home price in the Northeast was
$260,700, down 1.2 percent from a year earlier.
National Single-family and Condo Home Sales
Single-family home sales rose 3.5 percent
to a seasonally adjusted annual rate of 5.69 million in January from an
upwardly revised 5.50 million in December. But that still accounts for
4.2 percent below the 5.94 million-unit level in January 2006.
The median existing single-family home price was $209,200 in January, down 3.5 percent from a year earlier.
Existing condominium and cooperative
housing sales slipped 0.1 percent to a seasonally adjusted annual rate
of 767,000 units in January from a downwardly revised pace of 768,000
in December. Last month’s sales activity was 5.7 percent below the
813,000-unit pace in January 2006.
The median existing condo price was $222,200 in January, up 0.5 percent from a year ago.
NAR President: Market is Stabilizing
The national median existing-home price for
all housing types was $210,600 in January, down 3.1 percent from
January 2006 when the median was $217,400. The median is a typical
market price where half of the homes sold for more and half sold for
less.
NAR President Pat Vredevoogd Combs, from
Grand Rapids, Mich., says a broader view shows the housing market
stabilizing. “The market is trending up from its low last fall, and
that is important in restoring confidence to buyers who’ve been on the
sidelines,” Combs says. “Since buyers can find more favorable terms,
and they are looking for a place to call home for some years to come,
getting into the market now makes sense. It’s a choice many didn’t have
during the boom period of bidding wars in much of the country.”
— REALTOR® Magazine Online
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