New Housing Data Shows Sales Up in February

The National Association of Realtors^® released its February numbers for existing homes sale  today. They show an uptick in sales of resale homes for the first time in seven months. Don’t over-react to this upturn since there is still a lot of unsold inventory, in both new and resale homes, to clear out before we can expect increased sales to start to raise prices in the national numbers. Indeed, in the Western Region, the volume of sales continued to slip, showing that there is still a lot of recovery to do here.

The national median existing-home price for all housing types was $195,900 in February, down 8.2 percent from a year earlier when the median was $213,500.  Because the slowdown in sales from a year ago is greater in high-cost areas, there is a downward pull to the national median with relatively fewer sales in higher priced markets. The increase in FHA mortgage loan availability is likely to improve sales of higher priced homes over the next few months. Get other economists’ reactions to the news on the Wall Street Journal blog: Housing Reaching Its Bottom?

Remember the saying, “the only way we know we’ve hit bottom is when we start back up.” The news lags.  In Flagstaff, we still have about 9 months of unsold inventory. Don’t expect price increases here until 2009. 2008 is a great time to buy a Flagstaff home.