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Existing-Home Sales Slipped 0.8% in April 2011




Existing-home sales slipped 0.8% in April 2011, according to the National Association of Realtors.

Existing-home sales, which are completed transactions that include single-family, townhomes, condominiums and co-ops, eased 0.8% to a seasonally adjusted annual rate of 5.05 million in April from a downwardly revised 5.09 million in March, and are 12.9% below a 5.80 million pace in April 2010; sales surged in April and May of 2010 in response to the home buyer tax credit.

Lawrence Yun, NAR chief economist, said the market is underperforming. “Given the great affordability conditions, job creation and pent-up demand, home sales should be stronger,” he said. “Although existing-home sales are expected to trend up unevenly through next year, unnecessarily tight credit is continuing to restrain the market, along with a steady level of low appraisals that result in contract cancellations.”

According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage was 4.84 percent in April, unchanged from March; the rate was 5.10% in April 2010.

“Although sales are clearly up from the cyclical lows of last summer, home sales are being held back 15 to 20 percent due to the very restrictive loan underwriting standards,” Yun said.

All-cash transactions stood at 31% in April, down from a record level of 35% in March; they were 26% in March 2010; investors account for the bulk of cash purchases.

The national median existing-home price for all housing types was $163,700 in April, which is 5.0% below April 2010. Distressed homes – typically sold at a discount of about 20% – accounted for 37 percent of sales in April, down from 40% in March; they were 33% in April 2010.

Total housing inventory at the end of April increased 9.9 percent to 3.87 million existing homes available for sale, which represents a 9.2-month supply at the current sales pace, up from an 8.3-month supply in March.

First-time buyers purchased 36% of homes in April, up from 33% in March; they were 49% in April 2010 when the tax credit was in place. Investors slipped to 20% in April from 22% of purchase activity in March; they were 15% in April 2010. The balance of sales was to repeat buyers, which were 44% in April.

Existing-Home Sales by Housing Type

Single-family home sales slipped 0.5% to a seasonally adjusted annual rate of 4.42 million in April from 4.44 million in March, and are 12.6% below the 5.06 million pace in April 2010. The median existing single-family home price was $163,200 in April, which is 5.4% below a year ago.

Existing condominium and co-op sales fell 3.1% to a seasonally adjusted annual rate of 630,000 in April from 650,000 in March, and are 15.0% below the 741,000-unit level one year ago. The median existing condo price was $167,300 in April, down 2.3% from April 2010.

Existing-Home Sales by Region

Regionally, existing-home sales in the Northeast fell 7.5% to an annual pace of 740,000 in April and are 32.1% below a year-ago surge. The median price in the Northeast was $225,400, which is 7.3% below April 2010.

Existing-home sales in the Midwest rose 5.7% in April to a level of 1.12 million but are 16.4% below a cyclical peak in April 2010. The median price in the Midwest was $133,200, down 5.1% from a year ago.

In the South, existing-home sales declined 1.0% to an annual pace of 1.95 million in April and are 9.3% below a year ago. The median price in the South was $142,800, which is 4.1% lower than April 2010.

Existing-home sales in the West slipped 1.6% to an annual level of 1.24 million in April and are 0.8% below April 2010. The median price in the West was $203,400, down 6.1% from a year ago.

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