Sales of existing homes increased in February and remain within a fairly stable range, according to the NATIONAL ASSOCIATION OF REALTORS®.
Existing-home sales – including single-family, town homes, condominiums and co-ops – rose 2.9 percent to a seasonally adjusted annual rate of 5.03 million units in February from a pace of 4.89 million in January, but remain 23.8 percent below the 6.60 million-unit level in February 2007. The sales pace has been in a fairly narrow range since last September.
Lawrence Yun, NAR chief economist, said the gain is encouraging. “We’re not expecting a notable gain in existing-home sales until the second half of this year, but the improvement is another sign that the market is stabilizing,” he said. “Buyers taking advantage of higher loan limits for both FHA and conventional mortgages will unleash some pent-up demand. As inventories are drawn down, prices in many markets should go positive later this year.”
The national median existing-home price for all housing types was $195,900 in February, down 8.2 percent from a year earlier when the median was $213,500. Because the slowdown in sales from a year ago is greater in high-cost areas, there is a downward pull to the national median with relatively fewer sales in higher priced markets.
Meanwhile news for the condo market is not good according to The Wall Street Journal (Jennifer S. Forsyth and Jonathan Karp 03/22/2008) Reis Inc., a real estate research firm, has said that more than 10,000 new units are expected to be up for sale by developers in the Miami and Fort Lauderdale market.
The deluge is bad news for developers and the lenders that provided the money. Nation wide lenders of all sizes have $42 billion tied up in condominiums, according to Foresight Analytics. Between the third and fourth quarters of 2007, delinquency on that debt rose to 10 percent from 5.9 percent.
Some buyers who have put down a deposit are expected to walk away as prices drop.
The recently released The Fourth Quarter 2007 FDIC State Profile for Florida does not paint a very pretty picture. Here is a snapshot.