 The National Association of Realtors® released its existing homes sales data for August on Wednesday, blaming tight mortgage availability for a slowing of sales from July and the drop of 10.7% from August 2007 volume. Sales rose in the Midwest and South but fell in the Northeast and West. Nationally, existing-home sales – including single-family, townhomes, condominiums and co-ops –declined 2.2 percent to a seasonally adjusted annual rate of 4.91 million units in August from an upwardly revised pace of 5.02 million in July. NAR President Richard F. Gaylord, a broker with RE/MAX Real Estate Specialists in Long Beach, Calif., claimed that “the pendulum in the mortgage market has swung too far.” Although interest rates have already declined, he said, “there is a serious question as to whether a cash infusion by the U.S. Treasury into Wall Street would help consumers by improving mortgage funding.” According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage rose to 6.48 percent in August from 6.43 percent in July; the rate was 6.57 percent in August 2007. However, last week the 30-year fixed had dropped to 5.78 percent. Lawrence Yun, NAR chief economist, said the recent drop in interest rates is an immediate impact of recent government action. “August sales reflect higher interest rates before the government takeover of Freddie Mac and Fannie Mae, and the sudden drop in mortgage interest rates over the past couple weeks is improving housing affordability,” he said. “With higher loan limits and a beefing up of the FHA program, all the mechanisms have been falling into place to increase mortgage availability. Yun said. “Historically, housing has led the nation out of economic doldrums – there will not be an economic recovery without a housing recovery.” The national median existing-home price for all housing types was $203,100 in August, down 9.5 percent from a year ago when the median was $224,400. Areas that have had sharp price cuts are seeing a turnaround in sales. Sales volume is “rising very fast now in parts of California, Florida and Nevada,” according to Yun. The median existing single-family home price was $201,900 in August, down 9.7 percent from August 2007. The median existing condo price4 was $212,600 in August, which is 7.2 percent below a year ago. In Flagstaff, condos are typically less expensive than single family homes, but these national numbers represent the dominance of condos in more expensive, urban areas of the country. For regional numbers and information about the statistical basis for these numbers, see the full press release from NAR at Realtor Newsroom. |
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