Current State of Housing Market

Bloomberg has an interesting article out this morning on the current state of the US housing market. The news is mixed in my opinion:

U.S. Existing Home Sales Fall 0.5% in August; Sales Price Drops
By Shobhana Chandra and Joe Richter

Sept. 25 (Bloomberg) — Sales of previously owned homes in the U.S. fell in August to the lowest since early 2004, and prices fell from year-ago levels for the first time since 1995. Purchases declined 0.5 percent last month to an annual rate of 6.3 million, from 6.33 million in July, the National Association of Realtors said today in Washington. Sales fell 12.6 percent compared with a year earlier.

The median sales price fell 1.7 percent to $225,000 from a year earlier, the first drop since April 1995, David Lereah, chief economist for the Realtors, said at a briefing. Federal Reserve policy makers, who last week held interest rates steady for a second month, expect housing will cool gradually to slow the economy and help curb inflation.

“We’ve been anticipating a price correction and now it’s here,” Lereah said.

“The price drop has stopped the bleeding for housing sales. We think the housing market has now hit bottom.” Resales were expected to drop to an annual rate of 6.2 million, the median estimate of 58 economists in a Bloomberg News survey, from July’s originally reported 6.33 million. Economists’ forecasts ranged from 5.97 million to 6.42 million.

Home resales have fallen every month since March, when they were unchanged. They averaged 7.06 million last year. Existing home sales account for about 85 percent of the housing market and are recorded when a contract is closed, while new home sales are counted when a contract is signed.

Read full article here: http://www.bloomberg.com/apps/news?pid=20601087&sid=aAFuT8YFNJQk&refer=home

Welcome to the Arizona Mortgage Guru blog, a great resource for all your home financing needs. If you're new here and like the content, you can subscribe to my RSS feed to get regular updates on all things related to mortgages. Thanks for visiting.

Related posts brought to you by Yet Another Related Posts Plugin.