It's been confirmed -- there are some bargain seekers out there, and they are taking advantage of falling housing prices, particularly in the West, according to a report released yesterday by the National Association of Realtors. In the West, sales of existing homes jumped 13.6 percent in December from October, which is 31.6 percent higher than a year ago. Meanwhile, sales dropped 1.4 percent in the Northeast, rose 4 percent in the Midwest and rose 7.4 percent in the South. Overall, across the U.S., sales of existing homes jumped an unexpected 6.5 percent in December, but were 3.5 percent below December 2007's level.
Nationally, a bulk of the sales were of foreclosures, with sales of distressed properties making up 45 percent of all transactions in December, NAR said.
The news is both good and bad for homesellers, for while increased sales and a decrease in inventory (and less competition) is good for sellers, prices remained depressed, according to NAR. For homes of all types, home prices fell to a median price of $175,400 in December, 15.3 percent below December 2007 when the median was $207,000, according to NAR.
Reports Reuters, NAR chief economist Lawrence Yun noted that December's dip in median price is the biggest since NAR began keeping records in 1968 and perhaps the largest price decline since the Great Depression.
And while the uptick in sales is good news, a bottom is most likely a ways off: "Though unlikely to mark the bottom of the housing downturn, the report at least suggests the market is not spiraling downwards in response to mounting job losses and tightening credit standards," said Sal Guatieri, an economist at BMO Capital Markets in Toronto, in the Reuters article.—Lauren Baier Kim