Home sales decreased 4.8 percent nationwide in October 2008 over October 2007 in what real estate information firm REAL Trends calls a sloppy bottom-results that vary significantly from one month to the next. The strongest region was the West where homes sales increased 33.3% from October 2007. The hardest hit regions were the Northeast, which had held up better throughout the downturn that started in July 2005, where unit sales decreased 16.8%, and the South, which saw unit sales decrease by 17.1% from the same month a year ago. Prices strengthened in October with the average price of closed sales down 9.0% compared to the prior month's decrease on a year over year basis of 9.6% and was much improved from August 2008 results where prices were down 11.9% from the same period a year ago. The South fared best with prices down 7.1% followed by the Midwest where average prices were down 8.1%. The steepest price decline was recorded in the West region where prices were down an average of 19.1%. However, the West also led the way with a sales increase of 33.3%. REAL Trends Comment: "These results are mixed but seem promising as the housing market moves towards a sustainable floor," said Steve Murray, publisher of REAL Trends. "We don't know what impact the decline in equity markets will have or the weakening general economy, neither of which bodes well for the housing industry. A decline in interest rates and a significant rise in affordability may be enough to offset some of the other negative economic news." While indications are that written business fell in several key markets in October, including the Northeast, Mid Atlantic and Texas markets, overall sales held up remarkably well throughout the rest of the country. Murray points out that although, "one month doesn't confirm a housing market turnaround, consumers and investors are buying up significant numbers of lower priced foreclosures according to brokerage firms and sales professionals we talk to. Any strong housing turnaround will start with recovery with entry-level buyers. The recovery in closings in California, Arizona, Nevada and Florida are due to sales of lower priced homes and is a signal that Americans continue to see housing as a good investment."
Source: Real Trends November 25, 2008