Home Resales Rise in December

Washington, DC, Jan. 26, 2009--Sales of existing homes rose 6.5% in December from November to a seasonally adjusted annualized rate of 4.74 million as prices continued to plunge at a record pace, the National Association of Realtors reported Monday.

However, sales in December were down 3.5% from the previous December.
 
For 2008 as a whole, sales fell 13.1% to 4.91 million, the industry trade group said. November and December were the weakest sales months of the year on a seasonally adjusted basis.

The median sales price fell to $175,400 in December, down a record 15.3% compared with a year earlier. For all of 2008, median prices dropped 9.3% to the lowest level since 2004.

The price decline is likely the largest since the Great Depression in the 1930s, according to Lawrence Yun, chief economist for the trade group.

About 45% of the transactions in December were considered distress sales, either a short sale or a home in foreclosure. Many foreclosure sales are handled outside the realtors' system and are not reported in this report.

Sales in December were stronger than the 4.36 million expected by economists. November's sales pace was revised lower to 4.45 million from 4.49 million initially reported.

The sharp decline in mortgage rates in recent months probably didn't have much impact on sales that closed in December, Yun said. Home sales typically close two months or so after a contract is signed.

Inventories of unsold homes dropped 11.7% to 3.68 million, representing a 9.3-month supply at the December sales pace, compared with 11.2 months in November. Inventories typically decline about 8% to 10% in December, Yun noted. The inventory data are not seasonally adjusted.