Home sales fell 12% in 2010: CoreLogic
U.S. home sales totaled 3.6 million in 2010, a 12% drop from the year before that pulled prices down with it, according to data provider CoreLogic ($27.65 0%).
In November, the latest month of data available from CoreLogic, home prices dropped 5.1% for the fourth straight month of decline. Decreases in home prices have spread to 45 states from 18 just six months before.
"The downturn in home prices is clearly being driven by weak sales, an excess supply of unsold homes and larger impact from distressed sales," CoreLogic said in its report.
The number of homes sold in 2010 was at its lowest point since the housing market collapsed. Sales were more than 50% below the level seen before the crisis in 2005 and 33% below the level measured in 2000.
The CoreLogic data clashes with a report from the National Association of Realtors, which reported home sales dropped just 5% to 4.9 million and that home sales in 2009 actually increased from the year before. According to CoreLogic, home sales did not improve in 2009. There has been a steady decline since the peak in 2005. (See the chart below.)
CoreLogic said there are several reasons for the difference between its numbers and NAR's.
"There are several reasons for the divergence, including benchmarking drift, more sales going through MLS systems due to consolidation and a lower share of 'for sale by owners' home sales. Net, NAR’s existing home sales data are overstated by about 15% to 20%," CoreLogic said.
There was a 16-month supply of homes on the market that has not been sold as of November, the highest level since February 2009 when prices were falling about 20% on a year-over-year basis. A typical market has a six- or seven-month supply.
Going forward, CoreLogic said the housing market faces headwinds as it corrects its pricing and underwriting standards.
"Moreover, there will be increased headwinds on borrowers’ abilities to obtain financing because loans will become more expensive as the market normalizes and begins to more appropriately price for risk," CoreLogic said in its report.
Write to Jon Prior.
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