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October 25, 2005 - According to the National Association Of
Realtors, existing home sales held strong in September at 7.2% above the
level in September 2004, posting the second highest rate of sale on
record behind June of this year and in line with August.
David Lereah, NAR’s chief economist, said near-record activity was
supported by spiking home sales in areas surrounding the Hurricane
Katrina disaster zone. “We are now getting some hard data from this
region, with spot checks showing sharply higher home sales to residents
who were displaced by the hurricane. The sales surge is more than
offsetting declines in the disaster zone.”
The national median existing-home price2 for all housing
types was $212,000 in September, rising 13.4% from September 2004 when
the median price was $187,000.
The NAR suggested in a news release this month that sales are
softening and that the real estate boom will transition into a “soft
landing”. Total housing inventory levels inched up 0.3% at the end of
September to 2.85 million existing homes for sale, (a 4.7-month supply
at the current sales pace).
However, according to the Association Of
Home Investor Specialists, these figures mask differences in
regional and local markets, where some towns have inventory levels
approaching a year of more.
Single-family home sales rose 0.6% in September and were 6.9% above
level in September 2004. The median price was $212,200 in September, up
14.3 percent from a year ago.
Condominium and cooperative housing sales declined 4.7% from August but
remained 10.2% above the level in September 2004. The median condo price3
was $213,600, up 9.0% from a year ago.
Regionally, existing-home sales in the South rose 3.7% in September to a
record pace of 2.83 million, and were 12.3% higher than September 2004.
The median price in the South was $184,000, up 8.2% from September 2004.
Total existing-home sales in the Northeast rose 0.8% to an annual sales
rate of 1.21 million units in September, and were 7.1% above September
2004. The median price in the Northeast was $245,000, up 10.9% from a
year ago.
Existing-home sales in the Midwest slipped 3.0% to annual pace of 1.61
million in September from a record of 1.66 million in August, and were
4.5% higher than a year ago. The median price in the Midwest was
$175,000, which was 14.4% higher than September 2004.
Total existing-home sales in the West declined 4.1% to a pace of 1.62
million in September, but were 1.3% higher than September 2004. The
median existing-home price in the West was $302,000, up 14.8% from a
year ago.
1The annual rate for a particular month represents what
the total number of actual sales for a year would be if the relative
pace for that month were maintained for 12 consecutive months.
Seasonally adjusted annual rates are used in reporting monthly data to
factor out seasonal variations in resale activity. For example, home
sales volume is normally higher in the summer than in the winter,
primarily because of differences in the weather and family buying
patterns.
Existing-home sales, which include single-family, townhomes,
condominiums and co-ops, are based on transaction closings. This
differs from the U.S. Census Bureau’s series on new single-family
home sales, which are based on contracts or the acceptance of a
deposit. Because of these differences, it is not uncommon for each
series to move in different directions in the same month. In addition,
existing-home sales, which generally account for 85 percent of total
home sales, are based on a much larger sample – nearly 40 percent of
multiple listing service data each month – and typically are not
subject to large prior-month revisions.
2The only valid comparisons for median prices are with the
same period a year earlier due to the seasonality in buying patterns.
Month-to-month comparisons do not compensate for seasonal changes,
especially for the timing of family buying patterns.
3Because there is a concentration of condos in high-cost
metro areas, the national median condo price is higher than the median
single-family price. In a given market area, condos typically cost
less than single-family homes.
Existing-home sales for October will be released November 28. The next
Pending Home Sales Index will be on November 3 and the forecast will
be revised October 28.
Source: National Association Of Realtors |
