PMI Group Sees Mixed Housing Activity in September
Housing activity was mixed in September, with existing sales up sharply, new sales down modestly, and starts about unchanged, PMI Group (PMI) said in its monthly housing report. “We continue to project modest increases in home sales over the course of this year and next in response to high levels of affordability, investors and first-time buyers taking advantage of distressed sales, improving demographics, a pickup in the economy and the renewal and modest expansion of the first-time homebuyer tax credit,” PMI Group said. The seasonally adjusted rate of new home sales decreased for the first time in six months, down 3.6% to 402,000. PMI Group said this decline was due in part to concerns the first-time homebuyer tax credit would expire. The seasonally adjusted rate of existing home sales increased 9.4% to 5.57m, the highest level in more than two years. PMI Group said the supply of new homes is dwindling, and more buyers are turning to existing homes. PMI Group said median existing prices to fall 12% this year, including seasonally declines during the winter months. Next year, PMI Group expects sales to increase, particularly during the second half of the year, bolstered by an improvement in unemployment. PMI expects existing sales to increase 10.4% and new sales up 28.4%. Prices will stabilize next year, PMI said, but won’t increase during 2010. Write to Austin Kilgore.