NAR Reports Surprise Increase in Existing Home Sales

Single-family existing home sales unexpectedly jumped 7% in December from November but prices continue to slide as nearly half of all sales involved foreclosed houses. The National Association of Realtors reported that sales of previously owned homes rose from a seasonally adjusted annual rate of 4 million in November to 4.26 million in December. The recent drop in mortgage rates really did not affect December sales so it may be a good sign that sales will rebound in the months ahead. However, NAR estimates that 45% of December sales were foreclosed properties as buyers took advantage of large discounts. The home sales report shows that single-family house prices have fallen by 14.8% since December 2007. The Realtors are hoping the Congress will pass an economic stimulus package that will increase sales and quickly soak up the large inventory of unsold homes that continues to drag down home prices. "The Obama administration and Congress need to move fast to stimulate a spring sales upturn which will help to stabilize home prices and set the foundation for a sustainable economic recovery," said NAR chief economist Lawrence Yun.