Sales of existing homes in the United States saw an unexpected rise in December. The increase is mostly a result of bargain-basement home prices being sold in foreclosures and year-end deals. The report from the National Association of Realtors indicated that sales of existing homes rose 6.5 percent in December to an annual rate of 4.74 million. That’s an increase from the revised figure of 4.45 million in November.
Lawrence Yun, NAR chief economist, said home prices continue to fall significantly. “It appears some buyers are taking advantage of much lower home prices,” he said. “The higher monthly sales gain and falling inventory are steps in the right direction, but the market is still far from normal balanced conditions. Buyers will continue to have an edge over sellers for the foreseeable future.”
Nationwide, the median sales price dropped considerably. The median home price in December was US $175,400, which was down 15.3 percent from the same time in 2007. Prices in the last month of 2007 had a median of $207,000. That is the biggest year over year drop on record, back to 1968.
According to the report, sales from foreclosures and other distressed properties made up approximately 45 percent of overall sales. 2008 saw a total of 4.9 million existing homes sold, down over 13 percent from 2007. In one encouraging sign, the number of unsold homes on the market in the US fell to 3.7 million. At current market prices, it would take 9.3 months to sell the existing inventory, which is down from 11.2 months in November.
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