Existing homes sales which are completed transactions that include single-family, townhomes, condominiums and co-ops, rose 12.3% to a seasonally adjusted annual rate of 5.28 million in December from an upwardly revised 4.70 million in November, but remain 2.9% below the 5.44 million pace in December 2009.
NAR chief economist Lawrence Yun said sales are on an uptrend. "December was a good finish to 2010 when sales fluctuated more than normal. The pattern over the past six months is clearly showing a recovery," he said.
"The December pace is near the volume we're expecting for 2011, so the market is getting much closer to an adequate, sustainable level. The recovery will likely continue as job growth gains momentum and rising rents encourage more renters into ownership while exceptional affordability conditions remain."
The national median existing-home price for all housing types was US$168,800 (RM516,528) in December, which is 1.0% below December 2009. Distressed homes rose to a 36% market share in December from 33% in November, and 32% in December 2009.
"The modest rise in distressed sales, which typically are discounted 10 to 15% relative to traditional homes, dampened the median price in December, but the flat price trend continues," Yun explained.
Total housing inventory at the end of December fell 4.2% to 3.56 million existing homes available for sale, which represents an 8.1-month supply at the current sales pace, down from a 9.5-month supply in November.
NAR president Ron Phipps — who is also broker-president of Phipps Realty in Warwick, Rhode Island — said buyers are responding to very good affordability conditions despite tight mortgage credit. "Historically low mortgage interest rates, stable home prices, and pent-up demand are drawing home buyers into the market," Phipps said. "Recent home buyers have been successful with very low default rates, given the outstanding performance for loans originated in 2009 and 2010."
A parallel NAR practitioner survey shows first-time buyers purchased 33% of homes in December, up from 32% in November, but are below a 43% share in December 2009.
Investors accounted for 20% of transactions in December, up from 19% in November and 15% in December 2009; the balance of sales were to repeat buyers. All-cash sales were at 29% in December, compared with 31% in November, but up from 22% a year ago. "All-cash sales have been consistently high at about 30% of the market over the past six months," Yun said.
Single-family home sales jumped 11.8% to a seasonally adjusted annual rate of 4.64 million in December from 4.15 million in November, but are 2.5% below the 4.76 million level in December 2009. The median existing single-family home price was US$169,300 in December, down 0.2% from a year ago.
Existing condominium and co-op sales surged 16.4% to a seasonally adjusted annual rate of 640,000 in December from 550,000 in November, but remain 5.2% below the 675,000-unit pace one year ago. The median existing condo price was US$165,000 in December, which is 7.4% below December 2009.
Regionally, existing-home sales in the Northeast jumped 13.0% to an annual pace of 870,000 in December but are 5.4% below December 2009. The median price in the Northeast was US$237,300, which is 1.4% below a year ago.
Existing-home sales in the Midwest rose 11.0% in December to a level of 1.11 million but are 4.3% below a year ago. The median price in the Midwest was $139,700, up 3.3% from December 2009.
In the South, existing-home sales increased 10.1% to an annual pace of 1.97 million in December but are 2.5% below December 2009. The median price in the South was US$148,400, unchanged from a year ago.
Existing-home sales in the West surged 16.7% to an annual level of 1.33 million in December but remain 1.5% below December 2009. The median price in the West was US$204,000, down 5.6% from a year ago.
The NAR is America's largest trade association, representing 1.1 million members involved in all aspects of the residential and commercial real estate industries.
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