Home Prices go Up in Smoke!

Today, the National Association of Realtors released its monthly “Existing Home Sales” report for September along with some interesting analysis which paints a picture of market stabilization.

As David Lereah, Chief Economist of the National Association of Realtors puts it:

“Considering that existing-home sales are based on closed transactions, this is a lagging indicator and the worst is behind us as far as a market correction – this is likely the trough for sales, …. When consumers recognize that home sales are stabilizing, we’ll see the buyers who’ve been on the sidelines get back into the market, and sales will be at more normal levels in the wake of the unsustainable boom that we saw last year.”

Additionally, NAR President Thomas M. Stevens added:

“It appears we have passed a cyclical peak in terms of the number of homes on the market,”

In reality though, September not only marked the sixth straight month of sales declines nationally but also the greatest drop to median home prices on record.

Additionally, this month EVERY price and sales indicator was DOWN and EVERY inventory and supply indicator was UP, presenting indisputable evidence that the housing market is declining dramatically and thoroughly across every region of the US.

There should be little doubt now that the housing market is experiencing a significant correction even when looking at a national scope.

The following shows the data form all the NAR reports released today consolidated into one view:

National Statistics (Year-Over-Year as compared to September 2005)

• Median price of all existing homes declined by 2.2%

• Median price of existing single family homes declined by 2.5%

• Median price of existing condos declined by 2.8%

• Sales of all existing homes dropped 14.2%

• Sales of existing single family homes dropped 13.8%

• Sales of existing condos dropped 16.0%

• Inventory for single family homes increased 33.9% to 3,200,000

• Inventory for condos increased 42.9% to 546,000

• The number of months supply for all existing homes increased by 58.7% to 7.3 months.

• The number of months supply for all existing single family homes increased by 54.3% to 7.1 months.

• The number of months supply for all existing condos increased by a whopping 72.0% to 8.6 months.

Regional Statistics (Year-Over-Year as compared to September 2005)

Northeast

• Median price of all existing homes declined by 5.1%

• Median price of single family homes declined by 6.7%

• Median price of condos declined by 1.3%

• Sales of existing single family homes dropped 11.8%

• Sales of existing condos dropped 17.0%

West

• Median price of all existing homes declined by 4.3%

• Median price of single family homes declined by 3.1%

• Median price of condos declined by 12.5%

• Sales of existing single family homes dropped 24.7%

• Sales of existing condos dropped 16.4%

South

• Median price of all existing homes declined by 1.6%

• Median price of single family homes declined by 2.2%

• Median price of condos declined by 2.3%

• Sales of existing single family homes dropped 7.9%

• Sales of existing condos dropped 17.1%

Midwest

• Median price of all existing homes declined by 2.3%

• Median price of single family homes declined by 2.4%

• Median price of condos declined by 0.1%

• Sales of existing single family homes dropped 14.4%

• Sales of existing condos dropped 11.2%

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