Resales Stabilizing?

Sales of previously owned single-family homes rose 0.7% in November, and sales appear to be stabilizing as house prices continue to decline.The National Association of Realtors reported that sales of existing single-family homes rose from a seasonally adjusted annual rate of 4.37 million in October to 4.40 million in November. Sales transactions were down 20% since November 2006, but sales have stabilized since September, according NAR chief economist Lawrence Yun. The inventory of available homes for sale fell 3.7% from that of the previous month, to 3.6 million. And the median price of an existing single-family home stood at $208,700 in November, down 3.7% from that of a year earlier. Mr. Yun said jumbo mortgage rates are still 90-100 basis points higher than normal, which is crimping sales in high-cost areas, and too many homebuyers are trying to time the market. To spur sales, he said Congress should raise the $417,000 conforming loan limit so Fannie Mae and Freddie Mac can purchase jumbo mortgages, and the Federal Reserve should cut the target federal funds rate by 75 bps at its Jan. 29-30 meeting. Meanwhile, sales of existing condominiums and cooperatives slipped 1.6% to a seasonally adjusted annual rate of 600,000 in November from that of the previous month, and the median sales price stood at $221,000, down 0.7% from the level recorded in November 2006.