USA: August Home Sales Fall

Existing-home sales fell in August when mortgage availability problems were peaking, according to the National Association of Realtors. Total existing-home sales – including single-family, townhouses, condominiums and co-ops – were down 4.3 percent to a seasonally adjusted annual rate1 of 5.50 million units in August from a level of 5.75 million in July, and are 12.8 percent below the 6.31 million-unit pace in August 2006.

Lawrence Yun, NAR senior economist, expected the decline. “The unusual disruptions in the mortgage market, including a significant rise in jumbo loan rates, resulted in a fairly high number of postponed or cancelled sales, with many buyers having to search for other financing when loan commitments fell through,” he said. “Lower sales contributed to a build-up of unsold inventory.”

Yun expects similar results for home sales in September. “Once we get through these disruptions, we’ll get a better sense of where the actual market is in late fall as conditions begin to normalise,” he said.

The national median existing-home price for all housing types was $224,500 (£109,500) in August, up 0.2 percent from August 2006 when the median was $224,000 (£109,300). The median is a typical market price where half of the homes sold for more and half sold for less.

“Price gains in the Northeast and Midwest were largely offset by a decline in the West, while the median existing-home price in the South was down slightly, demonstrating that all real estate is local,” NAR President, Pat Combs said.

Northeast
Existing-home sales in the Northeast slipped 2.0 percent in August to an annual pace of 1.00 million, and are 5.7 percent below a year ago. The median price was $282,300 (£137,700), up 3.6 percent from August 2006.

South
Existing-home sales in the South eased by 2.7 percent to a level of 2.20 million in August, and are 12.7 percent lower than August 2006. The median existing-home price was $183,500 (£89,500) down 0.7 percent from a year ago.

Midwest
Existing-home sales in the Midwest fell 5.2 percent to an annual rate of 1.28 million in August, and are 10.5 percent below a year ago. The median price was $177,100 (£86,400), up 3.1 percent from August 2006.

West
Existing-home sales in the West dropped 9.8 percent in August to a level of 1.01 million, and are 21.7 percent below August 2006. The median price was $332,300 (£162,100), which is 3.8 percent below a year ago.