Existing-home sales rose again in November as first-time buyers rushed to close sales before the original Nov. 30 deadline for the recently extended and expanded tax credit, according to the National Association of Realtors (NAR).
Existing-home sales – including single-family, townhomes, condominiums and co-ops – rose 7.4% to a seasonally adjusted annual rate of 6.54 million units in November from 6.09 million in October, and are 44.1% higher than the 4.54 million-unit pace in November 2008. Current sales remain at the highest level since February 2007, when they hit 6.55 million.
‘We expect a temporary sales drop while buying activity ramps up for another surge in the spring, when buyers take advantage of the expanded tax credit – which hopefully will take us into a self-sustaining market in the second half of 2010," says Lawrence Yun, NAR's chief economist. "In all, 4.4 million households are expected to claim the tax credit before it expires, and balance should be restored to the housing sector with inventories continuing to decline."
A NAR practitioner survey shows first-time buyers purchased 51% of homes in November, compared with an upwardly revised 50% of transactions in October.
Total housing inventory at the end of November declined 1.3% to 3.52 million existing homes available for sale, which represents a 6.5-month supply at the current sales pace – down from a seven-month supply in October.
Raw unsold inventory figures are 15.5% below a year ago. The last time there was a lower supply of homes on the market was April 2006, when it was at a 6.1-month supply.
"Nearly all markets experienced a solid sales gain from one year ago," Yun adds. "The only markets with measurably lower sales were in San Diego, Riverside and Sacramento, where inventory shortages for lower-priced homes are limiting sales."
For the second month in a row, sales have risen in all price classes from a year earlier. Prior to October, the only consistent gains were in the lower price ranges.
The national median existing-home price for all housing types was $172,600 in November, which is 4.3% below November 2008. Distressed properties accounted for 33% of sales during the month.
Regionally, existing-home sales rose 6.6% in the Northeast, 8.4% in the Midwest, 4.8% in the South and 10.6% in the West.
SOURCE: National Association of Realtors