Existing Home Sales Fall 7.2 Percent; Median Sales Price Down 3.4 Percent

In January, existing homes sales slid back 7.2 percent to an annualized pace of 5.05 million units. This was the second consecutive large drop and now places the sales pace at the lowest its been since last June. Sales had grown quickly over the summer months, greatly aided by the home buyer tax credit. However, as the effects of the credit wore off, sales fell back down. It would appear at this point a good amount of the new sales generated over the summer were simply a temporal shift, increasing demand then at the expense of sales currently. The percent of purchases that were done by first time buyers fell to 40 percent, the lowest since last summer. Still from a year prior, sales were up 7.0 percent.

With this drop in the pace of sales, the supply of inventory rose to 7.8 months from 7.2 months. The supply of inventory will have to continue to decline before prices can be certain to have bottomed out. Over the month the median sales price fell 3.4 percent to $164,700. From a year prior, prices were down 4.7 percent.

	Jan	Dec	Nov	Oct	Sep	Aug
Sales (mil. annualized)	5.05	5.44	6.49	5.98	5.60	5.10
M/M % Change	-7.2	-16.2	8.5	6.8	9.8	-0.8
Median Price (‘000s)	$164.7	$170.5	$170.0	$172.0	$175.9	$177.2
M/M % Change	-3.4	0.3	-1.2	-2.2	-0.7	-2.3
Months Supply	7.8	7.2	6.5	7.2	8.0	9.2

10.02.26 (Source: National Association of Realtors)