Sales of previously owned homes jump 12.3% in December
National home sales jumped 12.3% from November to December, a positive sign for the housing market, although the sales pace remained below the level reached during the same period a year earlier.
The National Assn. of Realtors said Thursday that previously owned U.S. houses and condominiums sold at a seasonally adjusted annual rate of 5.28 million units last month. While an increase from November, that was still 2.9% below the December 2009 pace.
The expiration of a tax credit for buyers halfway through last year depleted sales substantially. Some economists viewed the December bump as an encouraging sign, although others warned that the weak labor market would probably keep the housing market from improving any time soon.
“This was a positive report across the board,” said Patrick Newport, U.S. economist for research firm IHS Global Insight.
Paul Dales, senior U.S. economist for research firm Capital Economics, wasn’t so optimistic.
“The decent increase in existing home sales in December takes them marginally above the levels seen before sales were boosted and subsequently depressed by the home-buyer tax credit,” he said. “But high unemployment, tight credit conditions and fears of more price declines mean that further upward progress will be gradual.”
The national median price fell 1% year-over-year to $168,000 in December. Sales of foreclosures and other distressed properties — cases in which the borrower is behind on the mortgage payment — rose to 36% of the sales market, up from 33% during the same month in 2009. Home prices have begun falling in several major American cities, and many economists predict the weakness will continue this year.
Total housing inventory at the end of December decreased to 3.56 million homes available for sale, representing about an eight-month supply at the current sales pace. Most economists view a six-month supply as healthy.
In California, an estimated 36,215 new and previously owned houses and condominiums sold last month, according to a separate report, released by the San Diego research firm MDA DataQuick. That was a 15.3% increase from November but a decline of 13.4% from December 2009.
Statewide, prices declined 0.4% from November and 3.8% from December 2009 to $254,000. The year-over-year decrease was the third in a row after eleven months of increases, DataQuick said.
Of all previously owned homes sold last month, 38.1% were properties that had been foreclosed on during the last year. That was up from a revised 37.6% in November and down from 40.8% in December 2009. The all-time high was 58.5% in February 2009.
