WASHINGTON – Existing-home sales nationwide fell 0.4 percent last month compared with the month before, to an annual rate of 4.89 million that was the lowest in at least nine years, based on statistics released today by the National Association of Realtors. Prices also fell nationwide, rising only in the Northeast, the NAR said.
January’s dip in sales followed a December decline of 2.19 percent – to a revised rate of 4.91 million units per year – that was less sharp that originally reported. (READ MORE) Analysts had expected the rate to fall 1.8 percent 4.80 million units per year, from the previously reported December rate of 4.89 million per year, based on a Bloomberg News survey of 63 economists. (Their estimates of the January sales pace ranged from 4.65 million to 5 million units per year.)
“Subprime loans and other risky mortgage products have virtually disappeared from the marketplace – and over the past five months, this has been reflected in soft but fairly stable home sales,” Lawrence Yun, the NAR’s chief economist, noted in a statement today. The existing-homes sales pace reported for January was the slowest since the trade group began posting such figures in 1999.
But going forward, Yun said, “As the increased limits for FHA and conventional loans are implemented, more buyers will have access to safer FHA loans and lower interest rate loans in high-cost areas, which could lead to steadily higher home sales later in the year.”
The nation’s housing inventory rose to 4.19 million homes on the market at the end of last month, an increase of 5.5 percent from the end of December and 18.4 percent from the end of January 2007. At the current pace of sales, that amounted to a 10.3-month supply, up from 9.7 months in December and 6.7 months a year ago.
The median price of existing homes sold in January fell to $201,100, a decline of 2.9 percent from December and 4.6 percent from January 2007. The median price of single-family homes sold last month fell 5.1 percent compared with a year ago, to $198,700, while the median price of condominiums and co-ops fell 1.0 percent year-over-year to $220,400.
In the Northeast, the median price of existing homes sold last month rose to $270,800, an increase of 6.3 percent compared with December and 3.1 percent compared with a year ago, while prices fell in the other three regions.
The sales pace for existing homes in the Northeast fell in January, however, to a seasonally adjusted 810,000 units per year, a decline of 3.6 percent from December and 25.7 percent from January 2007. Month-over-month declines also were seen in the West (-2.1 percent) and the South (-0.5 percent), though sales rose in the Midwest (+3.4 percent); compared with January 2007, sales fell in every region.
“The declines have been smaller than they previously were, but I think we’re still on the way down,” Nigel Gault, director of U.S. research at Global Insight Inc. in Lexington, Mass., told Bloomberg News. “Prices are going to have to keep going down if we’re going to work off the supply.”
The National Association of Realtors is the nation’s largest trade association, with more than 1.3 million members in all aspects of residential and commercial real estate. Additional information is available at www.realtor.org.
