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10% Jump in Existing Home Sales (???)

October 15, 2010

Somehow, existing home sales rose again in September!!  This helps fuel speculation that a home sales recovery has begun.  Existing home sales (not new construction) rose 10% from August to September.  The chief economist for NAR, Lawrence Yun, believes that the housing market is in the early stages of a recovery.  The way he sees it is this: the inventory is out there, mortgage rates remain low, and people still want to be homeowners.  Here are some fact nuggets for you: the average mortgage rate fell to a record low of 4.35% in September.  Now they are even lower.  The median home price in the US for all housing types in September was $171,400, which is 2.4% lower than a year ago.  We have about 4.04 million existing homes on the market, which equals a 10.7 month supply of homes.  Theoretically, what that means is that if no new homes came on the market, it would take that long to sell all existing inventory.  1st time homebuyers made up 32% of all home sales in September.  That was mostly due to the last few 1st Time Homebuyer Tax Credits going to closing.  Now that the tax credit has expired, we are seeing a lot less 1st time buyers.  Compare this to Cash For Clunkers…jumpstarted the auto industry, only for as long as the program was around, then it totally died out and still has yet to recover.

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