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Tight Inventories Provide Price Support

NAR: Median home price posts annual gain for 7th month in a row
By Inman News, Friday, October 19, 2012.

Sales of existing homes slipped from August to September but were still up strongly from a year ago — a sign that the national housing market is finding solid ground, the National Association of Realtors said today. At a seasonally adjusted annual rate of 4.75 million, sales of single-family homes, townhomes, condos and co-ops were down 1.7 percent from August to September, but up 11 percent from a year ago.

September sales of existing homes were up 11 percent from last September with a seasonally adjusted annual rate of 4.75 million, which represents a slight dip of 1.7 percent from August’s upwardly revised rate of 4.83 million.

The 2.32 million homes on the market at  the end of September represented a 5.9-month supply, down from 8.1 months a year ago. Many analysts view a six-month supply of housing as an even balance between buyer and seller demand.

Thanks to tight inventories, the national median  home price was up 11.3 percent to $183,900 from a year ago,  the seventh month in a row of annual increases and the longest stretch of annual increases in six years.

“We’re experiencing a genuine recovery,” said Lawrence Yun, NAR’s chief economist, in a statement. “More people are attempting to buy homes than are able to qualify for mortgages, and recent price increases are not deterring buyer interest,” he said.

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