Hope Springs Eternal
It’s hard to believe that just a year ago home prices for existing homes were rising at an average of 15%. Yet, within the span of one year, that average has dropped to below zero. That’s the first time since 1995. The National Association of Realtors announced that in August 2006, the national median price was $225,000, 1.7% lower than a year ago. But, the news is not all full of gloom and doom predicitions today. Hope does spring eternal. For instance:
• The decline in the number of existing homes sold was less than economists expected (only down 0.5% to 6.3 million). Interestingly, there was no change in the number of single-family homes sold in August. The decrease was entirely in the category of condominiums and cooperative apartments.
• While the inventory of unsold homes is at its highest since April of 1993, the increase from July to August was only 1.5%. This represented increase yet this year.
• JPMorgan Chase reported that the inflow of “new offers” was down 5% from a year earlier. An indicator that the market is adjusting to a more realistic marketplace.