Sales of existing homes fell another 1.2% in October to a seasonally adjusted annual rate of 4.97 million units, 20.7% below the October 2006 rate, according to the National Association of Realtors (NAR). Inventory of unsold homes stood at 4.45 million, a 10.8-month supply at the end of October, up from 10.4 months at the end of September.
The NAR, which reported the data this morning (Nov. 28), said single-family home sales were stable at an annual rate of 4.37 million in October, 20.8% below the rate of 5.52 million in October 2006. The median existing single-family home price was $205,700 in October, down 6.3% from a year ago. Existing condominium and co-op sales fell 9.1% to 600,000 units in October, 20.2% below October 2006. The median existing condo price was $223,500 in October, up 4.9% from a year ago.
"As noted last month, temporary mortgage problems were peaking back in August when many of the sales closed in October were being negotiated," said Lawrence Yun, NAR chief economist. "We continue to see the biggest impact in high-cost markets that rely on jumbo loans. Mortgage availability has improved as evidenced by much lower mortgage interest rates and a sharp jump in FHA endorsements for home purchases."
Yun added, "A trend away from subprime mortgages to FHA loans, which often carry much lower interest rates, is a positive development for consumers and the housing market going forward. Still, it will take some time for the change to yield a measurably higher closed sales volume in the aftermath of the subprime collapse. In the near term, we expect home sales to remain fairly stable."
According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage was 6.38% in October, unchanged from September; the rate was 6.36% in October 2006. Last week, Freddie Mac reported the 30-year fixed rate fell to 6.20%.
Regionally, existing-home sales in the Northeast were unchanged at an annual pace of 900,000 in October, 12.6% below October 2006, at a median price of $258,700, up 1.3% from a year ago. Sales in the South were also unchanged in October at an annual rate of 2.03 million, 19.4% below a year ago, at a median price of $171,400, down 6.7% from October 2006. Sales in the Midwest were down 1.7% to an annual rate of 1.18 million, 16.9% below last year, with a median price of $164,000, down 1.6% from a year ago. Sales in the West fell 4.4% to a level of 870,000, 33.1% below a year ago, at a median price of $318,200, down 6.9% from October 2006.