For the first time in five years, existing-home sales have increased for four months in a row, according to the National Association of REALTORS®. The housing market climate appears to be on the upswing and Realtor officials are optimistic.
Existing-home sales – including single-family, townhomes, condominiums and co-ops – rose 7.2 percent to a seasonally adjusted annual rate of 5.24 million units in July from a level of 4.89 million in June, and are 5.0 percent above the 4.99 million-unit pace in July 2008. The last time sales rose for four consecutive months was in June 2004, and the last time sales were higher than a year earlier was November 2005.
Lawrence Yun, NAR chief economist, said he is encouraged. "The housing market has decisively turned for the better. A combination of first-time buyers taking advantage of the housing stimulus tax credit and greatly improved affordability conditions are contributing to higher sales," he said.
According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage fell to 5.22 percent in July from 5.42 percent in June; the rate was 6.43 percent in July 2008.
An NAR practitioner survey showed first-time buyers purchased 30 percent of homes in July. Silicon Valley Association of REALTORS® President Julia Truesdale Keady said favorable home prices and incentives such as the first-time homebuyer tax credit are prompting more home buyers to take the plunge instead of sitting on the sidelines.
"Buyers see the market as a golden opportunity for them to achieve the American dream of homeownership. First-time home buyers are encouraged by the tax credit and we are also seeing increased activity among repeat buyers," said Keady.
Keady continues to remind first-time buyers who want to take advantage of the $8,000 tax credit to act quickly if they are serious about a purchase. "If first-time home buyers want to take advantage of the $8,000 tax credit, they need to close the transaction no later than November 30," Keady said.
The national median existing-home price for all housing types was $178,400 in July, which is 15.1 percent lower than July 2008. Single-family home sales increased 6.5 percent to a seasonally adjusted annual rate of 4.61 million in July from a pace of 4.33 million in June, and are 5 percent higher than the 4.39 million-unit level in July 2008. The median existing single-family home price was $178,300 in July, which is 14.6 percent below a year ago. Existing condominium and co-op sales jumped 12.5 percent to a seasonally adjusted annual rate of 630,000 units in July from 560,000 in June, and are 5.9 percent above the 595,000-unit level a year ago. The median existing condo price was $178,800 in July, down 18.9 percent from July 2008.
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