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Nationwide home sales hit 50-year low

September 28th, 2011 10:50 PM by Lehel S.

U.S. home sales sank to a 50-year low this spring and summer, hammered by a flagging economy and high unemployment.

Americans bought fewer new homes in the March-through-August stretch than at any other period since record keeping began half a century ago, and sales of existing homes were also dismal, the Commerce Department reported.

The figures underscore how badly the housing market is faring and suggest that a recovery is years away. But one local Realtor says things are not nearly as bad here.

"I think that a lot of this macro-economic news can be disheartening to buyers on the fence," said James Joseph, owner of Century 21 Ambassador and Coldwell Banker Ambassador in Whittier. "But we're further along in our recovery than other states are. The Midwest is just catching up to us."

Joseph said the region's low-priced inventory of available homes in the Whittier and San Gabriel Valley areas is active these days.

"They move fast, and if they're priced right we're getting multiple offers," he said. "But we have less of an inventory than we had six months ago or a year ago. Many sellers have taken their homes off the market. They're waiting for a better price."

Home prices in Los Angeles County continued to slide last month, with the region's median price falling 1.3 percent to $312,900 compared with $317,000 in July.

But August sales were up 3.4 percent from July and up 1.7 percent from a year earlier, according to the California Association of Realtors.

Bill Velto, a managing broker with Tarbell Realtors in Upland, said a lack of inventory is the biggest problem in the western Inland Empire and eastern San Gabriel Valley areas.

"There aren't enough sellable properties," he said. "In a city like Upland we might have 250 properties for sale, but 55 to 60 percent of those could be distressed properties - either REOs or short sales."

Bank-owned homes and short sales involve a lot more red tape, Velto said, and they typically take a lot longer to sell.

As a result, many frustrated buyers simply drop out of the process because it takes too long.

"There is also a lot of competition between investors and others who are buying traditional properties," Velto said. "In many cases, people can get loans. They're just not finding the properties."

In San Bernardino County, home sales rose 7.7 percent in August compared with July, and the region showed a yearly sales increase of 18.9 percent.

San Bernardino County's median home price topped out at $135,030 in August, up 0.8 percent from July but down 6.4 percent from a year earlier, CAR figures show.

Plunging stock prices and renewed recession fears have led many economists to push back expectations for a housing recovery.

Roughly 168,000 new homes were sold nationwide from March through August, the Commerce Department said Monday. That's fewer than the 180,000 for the same period last year, and last year's sales were boosted by a temporary buyer's tax credit.

About 2.8 million re-sale homes sold from March through August this year, roughly as many as in the same periods in 2009 and 2010. In a healthy market, about 3.3 million would be sold in that six-month stretch.

Celia Chen, a housing economist at Moody's Analytics, doesn't expect sales and prices to make a healthy recovery until 2015 at the earliest. In hard-hit areas like California and Florida, it could take decades for prices to return to normal, she said.

Posted in:General
Posted by Lehel S. on September 28th, 2011 10:50 PM

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