Our Terms of Service and Privacy Policy have changed.

By continuing to use this site, you are agreeing to the new Privacy Policy and Terms of Service.

Existing home sales jump 12%

By Blake Ellis, staff reporter


NEW YORK (CNNMoney) -- Sales of existing homes jumped in December, marking the fifth month of gains in the past six months, based on an industry report released Thursday.

Previously-owned home sales climbed 12.3% in December to an annual rate of 5.28 million, from 4.70 million in November, according to the National Association of Realtors.

That puts sales at the highest level since the homebuyer tax credit expired in June, said Stuart Hoffman, chief economist at PNC Financial Services Group.

The December rate came in much higher than expected. A consensus of experts surveyed by Briefing.com had forecast an annualized sales rate of 4.8 million. However, sales were down 2.9% from 12 months earlier and fell 4.7% in 2010.

"December was a nice finish to the year, but looking at the bigger picture -- home sales and prices have been scraping along the bottom for the last three years," Hoffman said. "So, while we're not digging a deeper hole -- the housing market is still quite weak, and there are still more homes available on the market than there are likely to be buyers."

The median price of all existing homes sold in December was $168,800, down 1% from a year ago.

Meanwhile, the inventory of homes on the market fell 4.2% in December to 3.56 million units. That's enough inventory to last 8.1 months, and is down from a 9.5-month supply in November.

While that's an improvement, Hoffman said that data doesn't reflect the large number of foreclosures that could soon enter on the market.

"What's hidden behind the curtain are potential foreclosures adding to those inventory levels," he said. "Even as we have jobs growing, inventory is still large and more foreclosures are going to be coming on the market. Prices will go down and it's going to continue to be very much a buyer's market."

That said, Hoffman expects sales to gradually improve -- rising about 4% or 5% -- by the end of 2011, as the employment picture improves.

"I do think there will be more sales in 2011, because job growth will support homebuyers," Hoffman said. "We're getting back to the underlying demand without the homebuyer tax credit, but housing is still not contributing much to the overall economic improvement in the economy."  To top of page


Overnight Avg Rate Latest Change Last Week
30 yr fixed4.01%4.14%
15 yr fixed3.18%3.29%
5/1 ARM3.24%3.30%
30 yr refi4.01%4.14%
15 yr refi3.19%3.31%
Rate data provided
by Bankrate.com
View rates in your area
 
Find personalized rates:
  • Find Homes for sale
    Real estate and homes for sale on Trulia

  • Property Type
  • Find a home in: New York | Atlanta | Chicago | Los Angeles
  • Washington D.C | Houston | Philadelphia | More options
Index Last Change % Change
Dow 20,661.30 -6.71 -0.03%
Nasdaq 5,821.64 27.82 0.48%
S&P 500 2,348.45 4.43 0.19%
Treasuries 2.40 -0.04 -1.64%
Data as of 6:55am ET
Company Price Change % Change
Bank of America Corp... 22.94 -0.08 -0.35%
Ford Motor Co 11.77 0.05 0.43%
Advanced Micro Devic... 14.10 0.28 2.03%
Nike Inc 53.92 -4.09 -7.05%
Wells Fargo & Co 55.33 -0.52 -0.93%
Data as of Mar 22

Sections

The typical plan on the individual market would have a deductible of $4,100, an increase of 61%, according to a Kaiser Family Foundation report. More

The advertiser backlash to Google is growing. Major brands have halted ads on certain Google platforms after learning their promotional posts were appearing alongside extremist content. More

Your credit score plays a major role in your personal finances. The better the score, the better it is for your wallet. Here's how to help get it above the 800 mark. More