Existing Home Sales Rise 3.6%

Posted by: Chris Palmeri on July 23, 2009

Americans are finding it a little easier to sell a home these days. The National Association of Realtors reports that existing home sales rose 3.6% in June to a seasonally adjusted rate of 4.9 million homes. That’s up from a 4.7 million rate in May.


for sale sign.jpg

The association cited tax credits for new homebuyers and low interest rates. The rate for a 30-year, conventional, fixed-rate mortgage rose to 5.42 percent in June from 4.86 percent in May; but that was still down from 6.32 percent in June 2008. An NAR survey in June showed first-time buyers accounted for 29 percent of transactions.

Total housing inventory at the end of June fell 0.7 percent to 3.82 million homes, which represents a 9.4-month supply at the current sales pace. That’s down from a 9.8-month supply in May. The total inventory is 14.9 percent below a year ago.

“The increase in existing-home sales occurred in all major regions of the country,” the association’s chief economist Lawrence Yun said. “This is another hopeful sign – if we can keep the volume of sales above the level of new inventory, prices could stabilize in many areas around the end of the year.”

The stock market thought so too. It is up today.

Reader Comments

Strategery

July 23, 2009 1:59 PM

And what will happen when people run out of unemployment benefits, the government incentives for buying a house go away and interest rates rise because of government spending? Also worth noting is that home sales peak in the early summer and decline for the rest of the year.

John

July 23, 2009 2:42 PM

Amazing what happens when home prices become even somewhat reasonable!

Sell Your House

July 24, 2009 2:15 AM

This is good news for us

lee

July 24, 2009 7:58 AM

I run a mortgage business in the UK my site is www.mortgagehome.co.uk.
The problem is the same here, houses are going up but there are so few available.

Kenneth G. Smith II

July 24, 2009 9:28 AM

Are we surprised? Or just so affixed to our computer screens, blackberries and cell phone that we forget real estate is Seasonal!

If home sales did not increase we would be floored, desperate and start to panic again. Analysts refer to the time in 2006 when 7.2 million housing units sold, but historically the number was around 5.5 million units. We should be relieved that the market is following historical selling patterns.

Sales should be up in July, August and September; but what are we going to do when activity falls off for the seasonal 4th and 1st Quarter period? The median sale price should be reversing itself and values should continue to stabilize. But again, this is all within historical patterns for real estate.

Are we that desperate for a news reporter or an economist working for the National Association of Realtors take on the market?

There are fundamental issues that remain in the market that still have not been addressed by the government or major financial institutions. There are alternatives that can restore stability to the markets that are not being addressed.

Do not be surprised in August to see Sales Activity grow 2.5% to 3%, August 2.0 to 2.5% and September barely over 1%. That is real estate and that is what we need to report.

Robin Garg

July 26, 2009 1:33 PM

Yes, with the downward progress in housing market, there is increase in selling of houses and that is a great sign of recovering hope as that has stopped the shrinkage in economy.

A good related link is

http://www.housingnewslive.com/blog.php/Rise in the U.S. Housing Sales, fueling recovery hopes??

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About

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.

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