Weekly Market Insight • Monthly Single-Family Home Sales; In Mi llions, Seasonally Adjusted Annual Rate • 02/27/12

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Monthly Single-Family Home Sales
In Millions, Seasonally Adjusted Annual Rate
February 27, 2012
Sources: Census Bureau, National Association of Realtors
Home sales delivered a split decision in January. The National Association of Realtors reported that existing home sales crept higher to an annualized rate of 4,570,000, their strongest pace since April 2010. But new home sales fell to an annualized rate of 321,000 according to the Census Bureau, breaking a string of four consecutive increases. Median home prices have trended lower over the past 12 months, down 2.0 percent for existing homes and 9.5 percent for new homes, although the latter indicator is volatile due to the small sample size. The most encouraging news from the two surveys is that the months of supply has fallen into the range of a balanced market – 6.1 months for existing homes and 5.6 months for new homes. But there is a caveat: The balanced supply results from low inventories versus strong sales activity. Inventories are likely to rise this year as foreclosures pick up on the heels of the government’s $25 billion settlement with banks over improper foreclosure processing, and as more would-be sellers test the market, releasing some pent-up supply. The rise in foreclosures will weigh on prices through much of the year. As apartment rents increase – up 2.0 percent in 2011 and 3.6 percent forecasted in 2012 according to Reis – homeownership will regain some of its lost luster with renters who can qualify for a mortgage.
Robert Bach, Senior Vice President, Chief Economist, has 30 years of professional experience in real estate market research, consulting and city planning. His commentary on the real estate markets is provided here on a weekly basis.

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Robert Bach
Senior Vice President, Chief Economist

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About CRE Northwest

Specialist in office & investment real estate in Seattle & the Eastside
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