America: House Prices Fall Further

American existing house sales slowed in April, partly because restrictive lending practices hampered home buyers. At the same time, a greater number of areas are showing sales gains from a year ago and a recent reversal in mortgage policy means the market is better positioned for a turnaround, according to the National Association of Realtors.

Existing house sales – including single-family, townhomes, condominiums and co-ops – declined 1.0 percent to a seasonally adjusted annual rate of 4.89 million units in April, 17.5 percent below the 5.93 million-unit level in April 2007.

Lawrence Yun, NAR chief economist, said eliminating restrictive policies should be a big help to home buyers. “I would encourage buyers who were disappointed by poor mortgage options to take another look at the market because the lending changes are significant,” he said. “Also, a recent notable drop in interest rates on conforming jumbo loans will help consumers in high-cost markets like California and New York.”

The American median existing house price for all housing types was $202,300 (£102,400) in April, which is 8.0 percent below a year ago when the median was $219,900 (£111,300). Total housing inventory at the end of April rose 10.5 percent to 4.55 million existing houses available for sale, which represents an 11.2 month supply at the current sales pace, up from a 10.0 month supply in March.

Single-family house sales slipped 0.5 percent to a seasonally adjusted annual rate of 4.34 million in April from 4.36 million in March, and are 16.1 percent below the 5.17 million-unit level recorded one year ago. The median existing single-family house price was $200,700 (£101,600) in April, down 8.5 percent from April 2007.

Existing condominium and co-op sales fell 5.2 percent to a seasonally adjusted annual rate of 550,000 units in April from 580,000 in March, and are 27.9 percent below the 763,000-unit pace in April 2007. The median existing condo price was $214,900 (£108,700) in April, which is 3.7 percent below a year ago.

West
Regionally, existing house sales in the West rose 6.4 percent in April to a level of 1.00 million but are 15.3 percent below a year ago. The median price in the West was $285,700 (£144,700), which is 16.7 percent lower than April 2007.

South
In the South, existing house sales were unchanged from March at an annual rate of 1.92 million in April, but are 18.6 percent below April 2007. The median price in the South was $170,800 (£86,400), down 5.1 percent from a year ago.

Northeast
Existing house sales in the Northeast fell 4.4 percent to an annual pace of 870,000 in April, and are 14.7 percent below a year ago. The median price in the Northeast was $262,000 (£132,600), which is 7.7 percent below April 2007.

Midwest
In the Midwest, existing house sales were at an annual rate of 1.10 million in April, which is 6.0 below March and 19.7 percent lower than April 2007. The median price in the Midwest was $159,100 (£80,500), down 2.9 percent from April 2007.
exchange rate used $1.00 = £0.506