March Existing Home Sales Surge
The National Association of Realtors reporter that the tax credit and favorable market conditions led to a boost in existing-home sales in March. Hopefully this is the beginning of a strong spring surge that we typically see. Completed transactions of existing home sales, which includes single family homes, townhomes, condos and co-ops, rose 6.8% to a seasonally adjusted annual rate of almost 5.4 million units in March. This is up from 5 million units in February 2010 and is 16.1% over the March 2009 level of 4.61 million units.
According to Lawrence Yun, chief economist for NAR: “Sales have been above year-ago levels for nine straight months, and inventory has trended down from year-ago levels for 20 months running,” he states. Additionally, “The home buyer tax credit has been a resounding success as these underlying trends point to a broad stabilization in home prices. This is preserving perhaps $1 trillion in largely middle class housing wealth that may have been wiped out without the housing stimulus measure,” Lawrence went on to say.
Total housing inventory rose 1.5% at the end of March to almost 3.6 million existing homes available for sale. This represents a 8 month supply, down a 1/2 month supply from February and 1.8% down from 1 year ago. The market is also down almost 22% below the July 2008 record of 4.6 million units in inventory.
Yun says that foreclosures have been feeding the inventory pipeline at a steady pace, but fortunately they are being sold quickly and absorbed easily. The best niche of foreclosures selling quickly continues to be the first time home buyer price range below $150k in the Eden Prairie Homes market. A different NAR study shows that first time home buyers purchased 44% of the homes in March, which is up 42 percent from February. This is an unprecedented number in real estate history. Additionally, investor purchases of home remained unchanged from Feburary levels at 19% of all transactions. Surprisingly all cash sales remained steady also at 27% of all sales in March and February.
I am a licensed Realtor in the State of Minnesota. This website is not a multiple listing service, but each Minnesota & Minneapolis real estate agent is a member of the Regional MLS of MN, inc., a provider of the Minnesota MLS.
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