Sales of existing homes fell for the sixth straight month in January, declining 0.4% to an annual rate of 4.89 million units on a seasonally adjusted basis, the National Association of Realtors reported this morning (Feb. 25). Sales were down 23.4% from January, 2007.

The decline came in comparison to an upwardly revised December estimate, which the NAR took up to 4.91 million from 4.89 million.

Still, inventory of unsold homes continued to rise, up 5.5% in January to4.19 million, a 10.3-month supply, up from 9.7 months in December. The national median existing-home price continued its decline, down 4.6% from January 2007 to $201,100 this January.

On a brighter note, single-family sales rose 0.5% from December to 4.34 million in January, down 22.4% below January 2007. The median existing single-family home price was $198,700 in January, down 5.1% from a year ago.

Existing condominium and co-op sales fell 6.5% to 550,000 units in January from 588,000 in December, 30.2% below the 788,000-unit level a year ago. The median existing condo price was $220,400 in January, which is 1.0% lower than January 2007.

Regionally, existing-home sales in the Midwest were up 3.4% from December to 1.20 million in January, 20.0% below January 2007, with the median price falling 4.0% to $154,200. Sales dipped 0.5% in the South month-to-month, 22% below last January, with the median price down 5.9% to $164,300 from January 2007. Sales fell 2.1% in the West month-to-month, and 28.5% year-to-year, with the median price off 6.7% to $300,100 from last January. Sales in the Northeast were down 3.6% from December, and 25.7% from last January, with the median price up 3.1% from last January to $270,800.

"Subprime loans and other risky mortgage products have virtually disappeared from the marketplace, and over the past five months, this has been reflected in soft but fairly stable home sales," said Lawrence Yun, NAR chief economist. "As the increased limits for FHA and conventional loans are implemented, more buyers will have access to safer FHA loans and lower interest rate loans in high-cost areas, which could lead to steadily higher home sales later in the year."

NAR President Richard Gaylord, a broker with RE/MAX in Long Beach, Calif., expects improvement in the months to come. "Once buyers have greater access to higher loan limits, it will take a few months for increased shopping activity to translate into higher sales," Gaylord said. "We should see some movement of pent-up demand by this summer, but higher loan limits need to be implemented fully and promptly to have maximum benefit."