The rate of existing-home sales fell for the sixth straight month in September and the median existing-home price dropped 2.2 percent in September compared to September 2005, the National Association of Realtors trade group reported today.
The seasonally adjusted annual rate of home sales fell to 6.18 million in September, which was 1.9 percent lower than the August rate and 14.2 percent below the September 2005 rate. The September 2005 rate was the third-strongest month on record.
The seasonally adjusted annual rate is a projection of a single month’s sales total over a 12-month period, adjusted for seasonal fluctuations in sales activity.
Total housing inventory levels fell 2.4 percent from the end of August to the end of September. An estimated 3.75 million existing homes were available for sale at the end of September, which represents a 7.3-month supply at the current sales pace.
The inventory of existing homes grew 35.1 percent in September compared to September 2005, while the 7.3-month supply in September represents a 58.7 percent increase over the September 2005 supply.
The national median existing-home price for all housing types was $220,000 in September, which is 2.2 percent below the September 2005 median price of $225,000, the association reported. The median is a typical market price where half of the homes sold for more and half sold for less.
Regionally, existing-home sales in the South rose 0.4 percent to an annual sales rate of 2.52 million in September, but were 9 percent below September 2005. The median price in the South was $184,000, down 1.6 percent from a year ago.
Existing-home sales in the Midwest eased 2.8 percent in September to a level of 1.39 million, and were 13.7 percent lower than a year ago. The median price in the Midwest was $169,000, which is 2.3 percent below September 2005.
Existing-home sales in the West fell 3.1 percent to an annual pace of 1.25 million in September, and were 23.8 percent lower than a year earlier. The median price in the West was $332,000, down 4.3 percent from September 2005.
Existing-home sales in the Northeast fell 3.7 percent to a level of 1.03 million in September, and were 13.4 percent below September 2005. The median existing-home price in the Northeast was $259,000, down 5.1 percent from a year earlier.
According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage was 6.4 percent in September, down from 6.52 percent in August; the rate was 5.77 percent in September 2005.
Single-family home sales slipped 1.6 percent to a seasonally adjusted annual rate of 5.42 million in September from a pace of 5.51 million August, and were 13.8 percent below the 6.29 million-unit level in September 2005, which was the second highest month on record, the association reported. The median existing single-family home price was $219,800 in September, down 2.5 percent from a year earlier.
Existing condominium and cooperative housing sales fell 3.2 percent to a seasonally adjusted annual rate of 763,000 units in September from 788,000 in August, and were 16 percent lower than the 908,000-unit pace in September 2005. The median existing-condo price was $219,800 in September, which was 2.8 percent lower than the September 2005 price.
David Lereah, NAR’s chief economist, said in a statement, “Considering that existing-home sales are based on closed transactions, this is a lagging indicator and the worst is behind us as far as a market correction — this is likely the trough for sales. When consumers recognize that home sales are stabilizing, we’ll see the buyers who’ve been on the sidelines get back into the market, and sales will be at more normal levels in the wake of the unsustainable boom that we saw last year.”
Sales are improving in some areas, Lereah also stated.
Thomas M. Stevens, NAR president, said in a statement, “It appears we have passed a cyclical peak in terms of the number of homes on the market. The good news is that fewer new listings are coming online. A stable sales pace is expected to draw down the number of listings to a supply balance that will support positive price growth within a few months. Taking the long view is always the best way to approach housing decisions, and right now, buyers are in a very favorable market.”
Existing-home sales, which include single-family, townhomes, condominiums and co-ops, are based on transaction closings.