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Good news is a rare treat in this housing market. Today’s National Association of Realtors report is at least mildly positive. It shows that existing home sales rose 2% in May to an annualized pace of 4.99 million compared to the April pace (But nearly 16% below May 2007 pace).
Sales could be picking up, especially in states like Nevada, California and Arizona because investors, first-time buyers and others are jumping on the low prices available for foreclosed homes. But the sales increase is small and the monthly home sales pace has stayed pretty close to 5 million since the credit crisis began last August.
The inventory of unsold homes in May did indeed fall by 1.4% to 4.49 million homes, which is a 10.8 months’ supply at the current pace of sales. But 10.8 months is still a huge number, about twice what it should be in a more stable market.
BusinessWeek editors Chris Palmeri, Prashant Gopal and Peter Coy chronicle the highs and lows of the housing and mortgage markets on their Hot Property blog. In print and online, the Hot Property team first wrote about the potential downside of lenders pushing riskier, "option ARM" mortgages and the rise in mortgage fraud back in 2005—well ahead of many other media outlets. In 2008, Hot Property bloggers finished #1 in a ranking of the world's top 100 "most powerful property people" by the British real estate website Global edge. Hot Property was named among the 25 most influential real estate blogs of 2007 by Inman News.