Median price rises 1.5% year-over-year in December

By Inman News, Monday, January 25, 2010.

While September through November saw a rise in the rate of resale home sales that was fueled at least in part by federal tax credits to homebuyers, December saw a monthly decrease in sales, according to a report released by the National Association of Realtors.

At the same time, both prices and sales rose year-over-year in December, and total sales grew in 2009 compared to 2008.

The rate of resale home sales dropped 16.7 percent last month to a seasonally adjusted annual rate of 5.45 million units from 6.54 milllion in November, but rose 15 percent year-over-year, from 4.74 million units. Resale homes include single-family homes, townhouses, condominiums, and co-ops, the association reported.

“It’s significant that home sales remain above year-ago levels, but the market is going through a period of swings driven by the tax credit,” said Lawrence Yun, the association’s chief economist.

“By early summer the overall market should benefit from more balanced inventory, and sales are on track to rise again in 2010. However, the job market remains a concern and could dampen the housing recovery — job creation is key to a continued recovery in the second half of the year.”

Coinciding with the extension of the homebuyer tax credit to include current homeowners, the share of homes bought by first-time homebuyers fell to 43 percent, from 51 percent in November, while repeat buyers increased to 42 percent in December from 37 percent a month earlier.

The sales rate of resale homes increased 4.9 percent in 2009, to 5.16 million from 4.91 million the year before. It was the first annual sales increase since 2005, the report said.

December also saw the first year-over-year increase in median price since August 2007, with a 1.5 percent increase to $178,300, according to the report. Yun attributed the gain to an increase in the number of mid-priced to higher-priced homes on the market.

Total inventory declined 6.6 percent month-to-month and 11.1 percent year-over-year to 3.29 million resale homes, which at the current sales pace represents a 7.2-month supply compared to a 6.5-month supply in November.

The seasonally adjusted annual rate of single-family home sales fell 16.8 percent to 4.79 million, which compares with 5.76 million in November, but rose 12.7 percent from the same period last year. Sales increased 5 percent for all of 2009, to 4.56 million, while the median price was $173,200, 11.9 percent less than 2008’s figure.

Resale condominium and co-op sales dropped 15.4 percent month-to-month to a seasonally adjusted annual rate of 660,000 from 780,000. Such sales rose 34.7 percent year-over-year, however, and increased 4.8 percent for all of 2009 to 590,000 units. The median price for such homes was $176,100 for all of last year, or 16.1 percent below the 2008 level.

The Northeast saw the highest year-over-year increase in resale home sales, at 21.3 percent. Month-to-month sales fell 19.5 percent. The median price increased 3.2 percent to $241,700 from December 2008.

The South saw the next-highest increase in the same period, at 15.5 percent, while month-to-month sales dipped 16.3 percent. The median price declined 1 percent compared to December 2008.

Resale home sales in the Midwest fell the most month-to-month, down 25.8 percent, and increased the least year-over-year, up 8.5 percent. The median price of $142,200 was the lowest in the country, although still 1.8 percent above December 2008.

In the West, sales fell 4.8 percent from November but increased 15 percent from December 2008. The median price went up to $236,000, 2.7 percent higher than in December 2008.