Sales smash annual record
January 27, 2003
NAR reports 5% year-over-year jump in national sales for 2002
Inman News Features
Existing single-family home sales climbed in December to top off the new annual record set in 2002, the National Association of Realtors reported today.
Approximately 5.6 million existing homes were sold last year, a 5 percent increase from the previous record of approximately 5.3 million sales set in 2001.
Existing-home sales were up 5.2 percent in December to a seasonally adjusted annual rate of 5.86 million units from an upwardly revised level of 5.57 million units in November. Last month's sales activity was 12.7 percent higher than the 5.2-million unit level in December 2001 and was the third-strongest monthly sales pace on record.
NAR's Chief Economist David Lereah said a combination of favorable market conditions has been contributing to record housing activity.
"Exceptionally low mortgage interest rates are the primary factor in record levels of home sales," said Lereah. "Strong demand by first-time home buyers, fueled by the children of the Baby Boom generation and by immigration, along with a generally good job market and growing families trading-up to larger homes, also has been contributing to record home sales activity."
NAR President Cathy Whatley said the momentum of home sales is expected to remain strong. "With favorable affordability conditions and an improving economy, home sales are projected to remain strong in 2003 and should come fairly close to record levels, but it's unlikely they'll top last year's record-smashing performance," she said.
Whatley said the only anticipated housing affordability problem is a localized shortage of homes for sale in the markets that have had a tight supply over the past year.
Housing inventory levels fell 10.8 percent at the end of December with 2.06 million existing homes available for sale, which represents a 4.2-month supply at the current sales pace, down from a 5-month supply in November, according to NAR.
The national median existing-home price was $164,000 in December, up 7.1 percent from the same month a year earlier when the median price was $153,100.
For all of 2002, the median price was $158,300, up 7.1 percent from a median of $147,800 in 2001 for the strongest annual increase since 1980 when the median price rose 11.7 percent.
Regionally, homes in the Midwest were reselling at an annual rate of 1.36 million units in December, up 12.4 percent from November; they also were 12.4 percent above December 2001. The median price in the Midwest was $137,300, up 4.6 percent from a year ago.
Existing-home sales in the South rose 4.6 percent in December to an annual rate of 2.29 million units, and were 11.7 percent higher than December 2001. The median price of an existing home in the South was $155,200, which was 6.7 percent higher than December 2001.
The home resale pace in the West rose 2 percent from November to an annual rate of 1.56 million units in December; the pace was 17.3 stronger than December 2001. The median existing-home price in the West was $215,200, up 11.3 percent from the same month a year earlier.
In the Northeast, existing-home sales rose 1.6 percent from November to a pace of 650,000 units in December, and were 6.6 percent higher than a year ago. The median existing-home price in the Northeast was $173,000, up 11.1 percent from December 2001.
NAR is a trade association representing more than 840,000 members involved in all aspects of the residential and commercial real estate industries.
Copyright: Inman News Service