Existing Home Sales Decline; Prices Rise for Seventh Consecutive Month

Existing home sales declined slightly in September,rnbut the national median home price rose as inventories tightened.  The National Association of Realtors® saidrnthat completed transactions of single-family homes, townhomes, condos, andrnco-ops were down 1.7 percent to a seasonally adjusted rate of 4.75 millionrnunits in September.  August sales werernrevised upward from 4.82 million to 4.83 million.  The September number is 11.0 percent higherrnthan existing home sales in September 2011 which were at an annual rate of 4.28rnmillion.</p

The national median existing home pricernincreased on an annual basis for the seventh consecutive month torn$184,900.  This was 11.3 percent abovernthe September 2011 median of $165,300. rnThe last time there were seven consecutive year-over-year increases wasrnfrom November 2005 to May 2006.  Thernaverage home price was $232,000 in September 2012 compared to $228,000 inrnSeptember 2011.</p

Single family home sales were also downrnslightly, from 4.29 million in August to 4.21 million in September, a decreasernof 1.9 percent but remained 10.8 percent higher than one year earlier.  The median single family home price wasrn$184,300, up 11.4 percent on an annual basis from $165,400 one year earlier.</p

Lawrence Yun, NAR chief economist, said the market trend is up. rn”Despite occasional month-to-month setbacks, we’re experiencing a genuinernrecovery,” he said.  “More people are attempting to buy homes than arernable to qualify for mortgages, and recent price increases are not deterringrnbuyer interest.  Rather, inventory shortages are limiting sales, notablyrnin parts of the West.”</p

Condo/townhousernand condo sales were flat at a rate of 540,000 units, the same as August but uprnfrom 480,000 units in September 2011. rnThe median price was $181,000, 10.0 percent higher than the median pricernof $164,500 one year earlier.</p

Distressedrnproperties took a slightly higher share of sales in September.  Foreclosure sales accounted for 13 percent ofrnsales and 11 percent were short sales. rnTwenty-two percent of sales were of distressed properties in August andrn30 percent in September 2011. rnForeclosures sold for an average discount of 21 percent from marketrnvalue in August and short sales were discounted 13 percent.</p

Inventoriesrnwere down by 3.3 percent in September to 2.32 million existing homes, a 5.9 monthrnsupply at the current pace of sales. rnThere was a 6.0 month supply in August. rnListed inventory is 20.0 percent lower than one year ago when there wasrnan 8.1 month supply.  </p

Medianrnmarketing time was 70 days in both August and September but a big improvement fromrna year earlier when the median time on market for an existing home was 101rndays.  Thirty-two percent of homes soldrnin the first month while 19 percent were on the market for six months or more.</p

 “The shrinkage in housing supply is supportingrnongoing price growth, a pattern that could accelerate unless home buildersrnrobustly ramp up production,” Yun said.</p

Thirty-two percent of buyers werernfirst-time purchasers in September, a number that has remained relativelyrnconstant over the last year.  Historicallyrnfirst-timers have represented about 40 percent of the market.  Investors purchased 18 percent of homes,rnagain a relatively constant number, and 28 percent of transactions in Septemberrnwere all cash compared to 30 percent a year earlier.  Investors account for most cash sales.</p

Regionally,rnexisting-home sales in the Northeast fell 6.3 percent to an annual level ofrn590,000 in September but are 7.3 percent above September 2011. rnThe median price in the Northeast was $238,700, up 4.1 percent from a year ago.</p

Existing-homernsales in the Midwest slipped 0.9 percent in September to a pace of 1.10 millionrnbut are 19.6 percent higher than a year ago.  The median price in thernMidwest was $145,200, up 7.0 percent from September 2011.</p

In the South,rnexisting-home sales increased 0.5 percent to an annual level of 1.93 million inrnSeptember and are 14.2 percent above September 2011.  The median price in the region was $163,600, up 13.1 percent fromrna year ago.</p

Existing-homernsales in the West fell 3.4 percent to an annual pace of 1.13 million inrnSeptember but are 0.9 percent above a year ago.  With continuing inventoryrnshortages in the region, the median price in the West was $246,300, which isrn18.4 percent higher than September 2011.

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