Existing-home sales rose, nationally, rose in November at their fastest pace since February 2007, according to the National Association of Realtors®. The Realtor® association believes that more than half the sales in November were purchases by first-time buyers who were rushing to close sales before the original November 30 deadline for the recently extended and expanded tax credit. Existing-home sales, including single-family, townhomes, condominiums and co-ops, rose 7.4 percent in November compared with the October rate and are 44.1 percent higher than a year ago in November 2008.
Economists were surprised by the pace of sales, according to the New York Times and MarketWatch.com. The Times said economists had expected sales for November to come in at an annual pace 6.25 million homes (MarketWatch’s survey said 6.28 homes). NAR reported an adjusted annual rate of existing home sales of 6.57 million units, while adjusting their earlier October reported annual pace downward slightly (to 6.09 million home sales from 6.10 reported in November).
Lawrence Yun, NAR’s chief economist, expects a drop in sales during the winter. NAR President Vicki Cox Golder, Tucson Realtor®, believes conditions are the best they can get for buyers right now. “Inventories have steadily declined and are closer to balanced levels, which indicate home prices in many areas are either stabilizing or could soon stabilize and return to normal appreciation patterns,” she said. “This means buyers still have good choices but are purchasing near the bottom of the price cycle with historically low mortgage interest rates. Throw a tax credit on top and it really doesn’t get any better for buyers with secure jobs and long-term ownership plans.”
The lynchpin of that optimistic assessment is that total housing inventory at the end of November declined 1.3 percent to 3.52 million existing homes available for sale, which represents a 6.5-month supply3 at the current sales pace. Raw unsold inventory figures are 15.5 percent below a year ago. The last time there was a lower supply of homes on the market was April 2006 when it was at a 6.1-month supply. The key is whether inventory levels can remain that low as foreclosures continue and bank-owned properties are released into the market. If prices begin to rise slightly, other sellers who are sitting on the sidelines may also jump back into listing their homes, which is likely to cause a secondary dip in prices.
The national median existing-home price for all housing types was $172,600 in November, which is 4.3 percent below November 2008.
Single-family home sales jumped 8.5 percent from October, and are 42.1 percent above the rate of November 2008. The median existing single-family home price was $171,900 in November, down 4.4 percent from a year ago.
Existing condominium and co-op sales in November were unchanged from October, but are 60.1 percent above the 481,000-unit pace a year ago. The median existing condo price was $178,000 in November, which is 3.1 percent below November 2008. (Nationally, condo prices are higher than single-family homes because of their concentration in higher-priced urban areas.)
Regionally, existing-home sales rose in all regions of the country while prices fell everywhere compared with a year ago. In the West, existing-home sales increased 10.6 percent to an annual rate of 1.46 million in November and are 28.1 percent above November 2008. The median price in the West was $231,100, which is 4.1 percent below a year ago. According to Yun, “The only markets with measurably lower sales were in San Diego, Riverside, and Sacramento, where inventory shortages for lower priced homes are limiting sales.”
Click here for my earlier report on Flagstaff homes sales in November. | 
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