Market Conditions by Realty Times
Most states continued to experience rising existing-home sales in the third quarter, with prices moderating in many metro areas, according to the latest survey by the National Association of Realtors®.
Sales increased from the second quarter in 45 states and the District of Columbia; 28states and D.C. saw double-digit gains. Year-over-year sales were higher in 32 states and D.C.
Lawrence Yun, NAR chief economist, said the tax credit is a significant factor. "We can't underestimate just how powerful a catalyst the first-time home buyer tax credit has been for the housing sector," he said. "It's given buyers the confidence they needed to get off the fence and take advantage of extremely affordable housing conditions. The buying conditions this year are the most favorable on record dating back to 1970, but the tax credit is allowing buyers to set aside any reservations about waiting for a better deal."
The national median existing single-family price was $177,900, which is 11.2 percent below the third quarter of 2008; the median is where half sold for more and half sold for less. Distressed sales – foreclosures and short sales – accounted for 30 percent of transactions in the third quarter, which continued to weigh down median home prices because they sell at a discount relative to traditional homes.
"The decline in the national median price has moderated recently, and a shrinking supply of unsold inventory suggests we are getting closer to price stabilization in many areas, but we need a steady stream of financially qualified buyers to further reduce inventory and get us to a self-sustaining market," Yun said. "Foreclosures will continue to come on the market, but rising sales from the expanded tax credit should stabilize home prices by next spring and help to stem future foreclosures."
NAR President Charles McMillan, a broker with Coldwell Banker Residential Brokerage in Dallas-Fort Worth, said he is encouraged by recent actions in Congress. "Extending and expanding the tax credit to more buyers through the middle of next year is the right medicine," he said. "Congress understands the impact of housing on the economy, so consumers who aren't able to complete a transaction before the end of this month now have a second chance but must have a contract in place by April 30."
Regionally, existing-home sales in the Northeast surged 16.7 percent in the third quarter to a pace of 930,000 units and are 6.9 percent higher than a year ago.
In the Midwest, existing-home sales jumped 13.2 percent in the third quarter to a pace of 1.20 million and are 5.2 percent above a year ago.
In the South, existing-home sales rose 11.3 percent in the third quarter to an annual rate of 1.97 million and are 5.9 percent higher than the third quarter of 2008.
Existing-home sales in the West increased 5.6 percent in the third quarter to an annual rate of 1.19 million and are 4.6 percent above a year ago.
For more information on your local market, visit Local Market Conditions.
Published: November 11, 2009
