The National Association of Realtors reports that sales of existing home in the western US produced an overall increase in sales and reduced inventory.
Through the month of December, sales of existing single-family homes, townhomes, condos and co-ops increased by 6.5 percent, yielding a seasonally adjusted annual rate of 4.74 million units. Although the rate is up over the 4.45 million units sold in November, it represents a decline of 3.5 percent from December 2007, when 4.91 million units sold.
The chief economist for the NAR, Lawrence Yun, indicated that the price of homes continues to decline. According to Yun, “It appears some buyers are taking advantage of much lower home prices.” He believes the increase in sales and the decline in inventory are positive indicators, but he warns that the market is still out of equilibrium, suggesting it will be a buyer’s market for the next many months.
The total inventory of housing fell from an 11.2 month supply in November to a 9.3 month supply in December, with 3.68 million existing homes on the market.
Regional Sales of Existing Homes
Sales of homes in the West rose to an annual rate of 1.25 million in December, an increase of 13.6 percent over the prior month and 31.6 percent higher than a year ago. The median price of an existing home dropped to $213,100, a decline of 31.5 percent from December 2007.
The Time is Right for Buying a Home
Charles McMillan, president of NAR, points out that this is the perfect time for new home buyers with good jobs to get into their first homes. Conditions are right: low mortgage interest rates, plenty of homes on the market, willing sellers, and prices lower than replacement cost should encourage buyers to take action.
Mr. McMillan encourages first-time buyers to look into FHA financing for low down payments on a 30-year fixed-rate mortgage.
Freddie Mac reports that the national average for a 30-year conventional fixed-rate mortgage fell to 5.29 percent in December from 6.10 a year ago. Last week, the agency reported the 30-year rate was 5.12 percent.