NAR Sees Pace of Home Resales Gain 3.8% in Q2
Existing home sales rose 3.8% in Q209, pushing the seasonally adjusted annual rate to 4.76m units from 4.58m units in Q109, although median prices remain well below last year's levels. The current sales rate came in 2.9% below Q208's annualized rate of 4.9m units, according to the quarterly survey by the National Association of Realtors (NAR). Interest rates near recent lows, combined with higher affordability as prices decline, will continue to drive sales, which present a "hopeful sign" to the broader economy, says Lawrence Yun, NAR's chief economist, in a statement on the survey. “Given the need for related goods and services, each home sale pumps an additional $63,000 into the economy – that’s how the housing engine traditionally pulls us out of recession," Yun says. "In addition, sales are drawing down inventory and that will help stabilize home values, which in turn will lessen foreclosure pressure and boost credit availability for other sectors of the economy.” Foreclosures and short sales accounted for 36% of Q209's transactions, which NAR said weighed down median prices. Foreclosures tend to sell at 15% to 20% below non-distressed sales. Median single-family prices across the US ranged from $55,700 in the Saginaw-Saginaw Township North area of Michigan to $569,500 in Honolulu during Q209. The median price in the Northeast slipped 9.7% to $246,000 from the year-ago quarter, while the median price in the Midwest slipped 8.6% from last year. The South saw a 10.3% dive from last year's median price, and the West plummeted 26.6%. Write to Diana Golobay.