Existing home sales dip in February
* Existing home sales slipped 0.6% to a seasonally adjusted annual rate of 5.02 million in February from 5.05 million in January. That was roughly in line with forecasts for a sales rate of 5 million.
* Regionally, sales were mixed. They fell 4.7% in the West and dipped 1.1% in the South. Sales rose 2.8% in the Midwest and climbed 2.4% in the Northeast. By property type, single family sales fell 1.4%, while condo and coop sales rose 4.8%.
* The raw number of homes for sale rose 9.5% to 3.589 million from 3.277 million in January. Compared with a year earlier, supply has dropped 5.5%. The months supply at current sales pace indicator of inventory rose to 8.6 from 7.8; that's the highest since August. Median prices were virtually unchanged at $165,100 in February versus $164,900 in January. On a year-over-year basis, prices were down 1.8%.
It seems we've found a "home base" level in housing. Cheap mortgage rates are somewhat offsetting the pressure of tighter lending standards. Foreclosures continue to be parceled out into the market. But aggressive loan modifications efforts are keeping them from flooding the market all at once -- and bargain hunters are buying when those units are priced right. Existing home inventory remains high. But the collapse in new home construction has left that part of the market with the smallest crop of for-sale inventory since President Nixon was in office.
This uneasy standoff -- with positive and negative forces roughly offsetting each other -- should persist for the remainder of the year. Depending on the economy's performance, 2011 could be yet another snoozer. That's better than the freefall from 2005-2009, but nothing like the vigorous recoveries we've seen after previous housing market downturns.