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REALTOR®: NAR Reports Existing-Home Sales Up Again

Wednesday, July 29, 2009

Existing-home sales rose for the third consecutive month with inventory easing and home prices declining less sharply in June, according to the National Association of REALTORS®. The sales gain is viewed as a hopeful sign that the housing market is slowly recovering.

Existing-home sales – including single-family, townhomes, condominiums and co-ops – increased 3.6 percent to a seasonally adjusted annual rate of 4.89 million units in June from 4.72 million in May, and are just 0.2 percent lower than the 4.90 million-unit level in June 2008. The gain is a hopeful sign, according to Lawrence Yun, NAR chief economist.

"The increase in existing-home sales occurred in all major regions of the country," Yun said. "We expect a gradual uptrend in sales to continue due to tax credit incentives and historically high affordability conditions."

According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage rose to 5.42 percent in June from 4.86 percent in May; the rate was 6.32 percent in June 2008. Total housing inventory at the end of June fell 0.7 percent to 3.82 million existing homes available for sale, which represents a 9.4-month supply at the current sales pace, down from a 9.8-month supply in May. Raw inventory totals are 14.9 percent below a year ago.

"These are all hopeful signs evident here in Silicon Valley and the rest of the country," said Julia Truesdale Keady, president of the Silicon Valley Association of REALTORS®. "The uptick in sales can be attributed to an improvement in housing affordability, lower prices, still very low interest rates, as well as the federal and state tax incentives for home buyers."

A NAR practitioner survey in June showed first-time buyers accounted for 29 percent of transactions, unchanged from May, and that the number of buyers looking at homes is up nearly 12 percentage points from June 2008.

NAR President Charles McMillan said there are very good opportunities. "Despite some of the challenges, the housing market continues to demonstrate signs of recovery," he said. "The temporary first-time buyer tax credit is clearly helping people make a decision and is contributing to the overall stimulus impact, but since it's taking longer to close transactions, many would-be beneficiaries may not be able to take advantage of the credit before the December 1 expiration date. As a consequence, consumers need the expertise of Realtors® more than ever to navigate both the obstacles and opportunities in today's market."

The national median existing-home price for all housing types was $181,800 in June, which is 15.4 percent below June 2008. Distressed properties, which accounted for 31 percent of sales in June, continue to downwardly distort the median price because they generally sell at a discount relative to traditional homes.

Single-family home sales rose 2.4 percent to 4.32 million in June from a level of 4.22 million in May, and are 0.2 percent higher than a year ago. The median existing single-family home price was $181,600 in June, which is 15 percent below June 2008. Existing condominium and co-op sales jumped 14 percent in June from 5 May, but are 3.1 percent below the 588,000-unit level in June 2008. The median existing condo price was $183,300 in June, down 18.9 percent from a year ago.


The Silicon Valley Association of REALTORS® (SILVAR) is a professional trade organization representing over 4,000 REALTORS® and Affiliate members engaged in the real estate business on the Peninsula and in the South Bay. SILVAR promotes the highest ethical standards of real estate practice, serves as an advocate for homeownership and homeowners, and represents the interests of property owners in Silicon Valley.

The term "REALTOR®" is a registered collective membership mark which identifies a real estate professional who is a member of the National Association of REALTORS® and who subscribes to its strict Code of Ethics.

Variations of this article have appeared in local area newspapers.

For further information, please contact Rose Meily at SILVAR Public Affairs, email , or phone (408) 200-0109.

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