This Month in Real Estate, Real Estate News and Information!

Another slight drop for mortgage rates as they continue to set historically low records. With homes being so affordable and the economy continuing its recovery, home prices are stabilizing, as increased sales are expected. NAR President Moe Veissi stated, "The American dream of home ownership is alive and well. We have a large pent-up demand, and household formation is likely to return to normal as the job market steadily improves. More buyers coming into the market mean additional benefits for the overall economy. When people buy homes, they stimulate a lot of related goods and services."

Existing home sales continued their rise, up 5% in December, to a seasonally adjusted rate of 4.61 million. Lawrence Yun, chief economist for NAR, said, "The pattern of home sales in recent months demonstrates a market in recovery. Record-low mortgage interest rates, job growth, and bargain home prices are giving more consumers the confidence they need to enter the market."

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Homes prices for December were down 2.6% from a year ago, at a median price of $164,500. One factor contributing to lower prices has been the high level of distressed properties being sold. In December, these properties began to show signs of price stabilization and increase. Foreclosures were selling at 22%, a 2% increase from a year ago, and average prices for short sales prices had risen by 3%.

The housing inventory dropped 9.2% in December to a 6.2-month supply, or 2.38 million homes, at the current level of sales. These are the lowest inventory levels of homes for sale since March of 2005. Lawrence Yun, chief economist for NAR, said, "The inventory supply suggests many markets will see prices stabilize or grow moderately in the near future."

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