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September 26th, 2012 (Modified on October 1st, 2012)

Home sales, prices post gains

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homebuyer-sellerHome sales and prices were on the rise in August.

That’s according to the National Association of Realtors (NAR), a Chicago-based trade group that represents 1 million realty brokers and salespeople.

More homes sold

Home sales hit an annualized and seasonally adjusted pace of 4.82 million units for the month, up 7.8 percent compared with 4.47 million in July and 9.3 percent compared with 4.41 million in August 2011, NAR said in a statement.

Annualized sales figures project totals for the entire year while seasonal adjustments account for variations in sales, but don’t compensate for abnormal weather patterns. The totals include single-family homes, townhomes, condominiums and co-ops, but not newly constructed houses sold by builders.

Home prices rise

The national median price of homes sold climbed to $187,400 in August, up 9.5 percent compared with August 2011.

The median price is the midway point at which half of the homes sold at higher prices and half sold at lower prices. Median prices can be distorted by changes in the mix of homes sold.

NAR Chief Economist Lawrence Yun attributed the results to favorable home-buying factors. Homes today are more affordable due to low mortgage interest rates and depreciated values.

Fewer homes for sale

Housing markets are also strengthening due to fewer homes being for sale. NAR reported that 2.47 million existing homes were on the market at the end of August. That represented a 6.1-month supply at the then-current pace of sales, down 18.2 percent compared with the 8.2-month supply at the end of August 2011.

A six-month supply is generally viewed as a balanced market, favoring neither buyers nor sellers. However, local market conditions can and often do vary considerably from the national picture.

Other August statistics: First-time home buyers accounted for 31 percent of purchases, all-cash sales made up 27 percent of transactions, and investors, who account for most cash sales, purchased 18 percent of the homes sold.

Tight lending conditions

In a separate statement, NAR also said an additional 500,000 to 700,000 homes could be sold annually if mortgage lending standards were eased.

A survey of Realtors found widespread concern over what NAR characterized as “unreasonably” tight credit for residential mortgages. Realtors said lenders required excessive information from borrowers and took too long to approve loan applications.

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One Response to “Home sales, prices post gains”

  1. Jason Says: September 30th, 2012 at 3:28 pm

    Great news Marcie, and we can echo those kinds of numbers here in Texas. We’re happy seeing our home communities growing once again and even in the Arizona market we’re selling homes once again, and at better rates than earlier in the year. It’s not totally back yet but it’s improving.

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HSH.com's daily blog focuses on the latest developments in the mortgage and housing markets. Our mission is to relate how changes in mortgage rates and housing policy, as well as the latest financial news, impacts consumers, homebuyers and industry insiders alike. Our 30-plus years of experience in the mortgage industry gives us an edge as we break down the latest changes in an ever-changing market.

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Tim Manni is the Managing Editor of HSH.com and the author of their daily blog, which concentrates on the latest developments in the mortgage and housing markets.

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