According to the National Association of Realtors, the number of home sold fell 2.2% in October from September and fell 25.9% from September 2009. Although median home prices remained level from September 2009, roughly a third of all sales were distressed homes. The U.S. Commerce Department reports that new home sales dropped 8.1% from September and nearly 30% from September 2009.
New home sales are down 80% from its peak in July 2005, making it the lowest reported sales month since the government began tracking in 1963.
According to CoreLogic, shadow inventory rose 10% over the past 12 months leaving an eight month supply. At the current rate of home sales, reported shadow inventory plus visible inventory, it would take nearly two years to sell it all.
Texas has the lowest ratio of distressed properties to sales while Michigan, Florida and California have the highest.
Given the bad news for the real estate sector, economists don’t agree on when a recovery will arise (although certain Associations are proclaiming the recovery already began).
As the entire team at AG has been screaming for years, there will be no real estate recovery without an employment recovery. Retailers will enjoy great sales today on Black Friday, but in real estate, we need our own Black Friday which will only come in the form of dramatically improved employment stats so that not only are people employed at 2005 levels but are no longer underemployed and hanging on by a thread.