Housing resale numbers shot up 5.5% in September from the same time a year ago. Analysts are calling it the largest gain in U.S. existing home sales since the summer of 2003. The new data was released by the National Association of Realtors (NAR) at the end of last week and came as a welcome surprise in the midst of financial hard times for Americans. Real estate experts and economists did not anticipate the “mini buying boom,” which reduced the stock of existing homes for sale by 1.6% and brought inventory levels down to just under a 10 months’ supply.
Dropping housing prices have finally enticed buyers to make a move. The median U.S. home price went down 9% from the previous year, according to the NAR report, making many properties more affordable for American buyers. This trend, if sustained, could be what the country needs to trim the surplus of unsold homes back to a healthy quantity. Then, when inventory levels are balanced, real estate prices will immediately go up as a result of demand.
Some analysts predict the turning point will occur sometime in 2010. But with the spike in activity we experienced in September (which well exceeded forecasts), home buyers may surprise again in the future and get things moving in the right direction much quicker than anticipated.
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