November Existing Home Sales Soared 7.4 Percent

sold 2Home resales surged last month to the highest level in nearly three years, reflecting an extraordinary level of federal support that has pulled the housing market back from the worst downturn since the Great Depression. Buyers were racing to complete their sales before the original expiration date of a tax credit for first-time buyers that was scheduled to expire Nov. 30. Last month, Congress decided to extend and expand the credit to ensure the housing market could sustain its recovery. The Realtors estimated that about 2 million homebuyers have taken advantage of the credit so far and forecasts that another 2.4 million will use it by the middle of next year. First-time buyers made up about half of all transactions last month, driving sales up 44 percent above last year’s levels, a record jump.

Sales are now up 46 percent from the bottom in January, but down 10 percent from the peak more than four years ago.

The median sales price was $172,600, down 4.3 percent from a year earlier, and up 0.2 percent from October.

“Things are stabilizing,” said Pete Flint, chief executive of real estate Web site Trulia.com. “There is a significant amount of buyer interest out there.”

November sales rose 7.4 percent to a seasonally adjusted annual rate of 6.54 million, from a downwardly revised pace of 6.09 million in October.

Sales had been expected to rise to an annual pace of 6.25 million, according to economists surveyed by Thomson Reuters.

The inventory of unsold homes on the market fell about 1 percent to 3.5 million. That’s a healthy 6.5 month supply at the current sales pace, the lowest level in three years.

Besides the existing tax credit of up to $8,000 for first-time buyers, homeowners who have lived in their current properties for at least five years can now claim a tax credit of up to $6,500 if they relocate. To qualify, buyers must sign a purchase agreement by April 30.

Postponing the deadline could mean sales will drop during the winter months and recover in the spring.

“Buyers have no sense of urgency now,” said Gary DeRosa, an agent with ZipRealty Inc. in Seattle. AP

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4 COMMENTS

  1. Deutsche Bank: Home Prices to Fall 10 Percent
    Monday, 21 Dec 2009 08:31 AMArticle Font Size By: Julie Crawshaw

    Deutsche Bank researchers say home prices will drop a further 10 to 12 percent from current levels.

    The projections come from the securitization arm of the investment bank and are the first forecast expanded to include more factors that impact home prices overall as well as a variety of ranges that include month-to-month and peak-to-trough, housingwire.com reports.

    “A change in market psychology (which can both cause, and be caused by, recent home price increases), some signs of labor market stabilization and various government programs aimed at easing the housing crisis have all been constructive for housing,” DB researchers write.

    Nonetheless, recent home price gains have likely run their course.

    “Government bailouts lack the potency to counter larger issue of unemployment, tight credit and the rising negative equity,” they say. “In the worst of it, with another 29 percent decline in home prices (is) projected.”

    A new study estimates there was a 1.7 million-unit pending supply of U.S. residential housing inventory at the end of September, up from 1.1 million a year earlier, according to research firm First American CoreLogic.

    The pending supply, sometimes called shadow inventory, includes estimates of real estate owned by banks and mortgage companies and real estate at least 90 days delinquent.

    Normally, the so-called shadow supply is not included in official measures of unsold inventory, First American CoreLogic said.

  2. Deutsche Bank is saying “Nonetheless, recent home price gains have likely run their course.

    “Government bailouts lack the potency to counter larger issue of unemployment, tight credit and the rising negative equity,” they say. “In the worst of it, with another 29 percent decline in home prices (is) projected.”

    A new study estimates there was a 1.7 million-unit pending supply of U.S. residential housing inventory at the end of September, up from 1.1 million a year earlier, according to research firm First American CoreLogic.

    It is not saying freat this is all over.The realtor have been predicting home sales going up evere since they started going down. Realtors are the worst they can’t sell houses if they tell people that they expect housing priceds to decrease. real data comes from out of the way sources like Deutsche Bank

  3. Today a new report finding prices are going down along with Deutsch Bank. Don’t get “Bamboozeled” by the agent telling you all “Finer” stories NOTHING is happening out there.

    WASHINGTON (AP) Sales of new homes plunged unexpectedly last month to the lowest level since April, a sign the housing market recovery will be rocky.

    The Commerce Department says November’s sales fell 11.3 percent to a seasonally adjusted annual rate of 355,000 from a downwardly revised 400,000 in October. Economists surveyed by Thomson Reuters had expected a pace of 440,000.

    Sales were down 9 percent from a year ago. The results suggest buyers will wait until spring before taking advantage of newly extended and expanded federal tax incentives designed to spur sales.

    The median sales price of $217,400 was down nearly 2 percent from $221,600 a year earlier, but up about 4 percent from October’s level of $209,400.

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