Existing Home Sales Continue Slide

The existing home sales numbers are out. "Sales of existing homes set a record for a fifth straight year in 2005 even though the year ended on a weaker note with three straight monthly declines, sending a strong signal that the nation's housing boom is beginning to cool." "The National Association of Realtors reported that sales of previously owned homes and condominiums dropped by 5.7 percent in December compared to the sales pace in November. It marked the third consecutive monthly decline, something that has not occurred in more than three years." The median for the US was $211,000, down from the October high of $218,000. Median prices in the west were down to $318,000 from Novembers $333,000. And even though inventory was down 4.4% from November, the 'months sales' figure climbed to 5.1. The annual pace of sales fell to 6,600,000, from Novembers 7,000,000, and a high of 7,350,000 in June of 2005. "'Clearly the air is coming out of the balloon,' David Lereah, chief economist at the Realtors' group, said. 'We're transferring from a sellers' market to a buyers' market.'" "Home resales fell 11 percent in the West to 1.40 million. They were unchanged at 1.09 million in the Northeast. In the Midwest, sales fell 2.6 percent to 1.52 million, and they fell 7.2 percent in the South to 2.58 million. 'I have a lot of confidence that these balloons won't burst,' Lereah said. 'They're balloons, not bubbles.'" Update: Inman News reports that excluding condos, the sales are worse. "Existing condominium and cooperative housing sales increased 1.6 percent to a seasonally adjusted annual rate of 877,000 units in December from a level of 863,000 in November. Last month's sales activity was 4.5 percent higher than the 839,000-unit pace in December 2004." "Single-family home sales declined 6.8 percent to a seasonally adjusted annual rate of 5.72 million in December from 6.14 million in November, and were 4.2 percent lower than the 5.97 million-unit pace in December 2004."