Uptick in Sales of Existing Homes, Group Says

Prices and sales of previously occupied U.S. homes improved during the last three months of last year as low interest rates and a federal tax credit helped push buyers into the market, the National Association of Realtors said Thursday.

Prices in 67 out of 151 metropolitan areas tracked by the group, or more than 40 percent of those cities, reported higher median home prices for previously owned single-family homes. Sixteen of the areas posted double-digit increases.

In the third quarter, only 30 metro areas showed annual price increases and 123 areas were down. The median is the point at which half of the homes sold for more and half sold for less.

The national median existing single-family price was $172,900, a 2.9 percent increase from the third quarter and a decline of 4.1 percent from the fourth quarter of 2008.

Total existing home sales, including single family and condominium units, increased to a seasonally adjusted annual rate of 6.03 million in the fourth quarter, up 13.9 percent from the prior quarter and 27.2 percent higher than in the fourth quarter of 2008.

Distressed property – either bank-owned homes or those sold by homeowners who can’t make their payments – accounted for 32 percent of all transactions in the fourth quarter, a decline from 37 percent a year earlier.

“The surge in home sales was driven by buyers responding strongly to the tax credit combined with record low mortgage interest rates,” said Lawrence Yun, chief economist for the Realtors group. “With inventory levels trending down over the past 18 months, we expect broadly balanced housing market conditions in much of the country by late spring with more areas showing higher prices.”

source: Miami Herald