Home Resales Rose
American home resales rose in September more than forecasted- according to NAR, purchases of existing homes jumped 5.5 percent last month to a 5.18 million annual pace, the highest level in the last 12 months while the median national price dropped 9 percent.
Sales rose 1.4 percent compared with a year earlier, the first year-over-year increase since November 2005. Resales totaled 5.65 million in 2007.
Today’s figures compare with the 4.86 million level reached in June, the lowest in a decade and 33 percent down from the record reached in September 2005.
Foreclosures account for 35 to 40 percent of last month’s sales and according to Lawrence Yun, roughly 80% were primary residences, higher than the average 75% signaling that investors are NOT the primary reason for the jump.
Improved Sales- Temporary?
With the economy in an unpredictable state, I’m sure we’ll see many more reports of exceeding or declining from forecasted numbers but meeting numbers won’t likely make news.
Sales are doing better nationally but is that temporary? Is credit STILL tightening? Are banks nervous that foreclosures will depress values? Will they withhold financing because of their concerns making lower prices short lived?
“In terms of sales, I think we have bottomed out,” Yun said in a press conference. “The first step to housing-market stabilization is rising home sales. Hopefully, this trend can continue.” Yun also said, “inventories need to continue dropping in order to stabilize prices, and that will take more time.”
New Home Construction
But what about new homes? New home construction accounts for 10% of national home sales and many builders are reporting lower than expected sales for the month while others are putting entire projects on hold.
“The housing downswing is really not exactly even nearing a bottom at this point,” David Seiders, chief economist at the National Association of Homebuilders said. “The core problem in the economy is still housing, and house prices are decimating the financial markets.”
What About YOUR Market?
Most of these numbers are absolutely NOT a depiction of Austin, are they close to the mark where you practice real estate? What are things like where you are?
sources: businessweek.com, NAR
photo source: flickr