September existing home sales surge 10%
* Sales surged 10% to a seasonally adjusted annual rate of 4.53 million from 4.12 million in August. That was better than the 4.3 million in sales that analysts were expecting, but it's still down 19.1% from a year ago.
* Regionally, sales rose 5% in the West, 10.1% in the Northeast, 10.6% in the South, and 14.5% in the Midwest. By property type, single-family sales rose 10% and condo/co-op sales gained 9.8%
* The supply of homes for sale dipped 1.9% to 4.04 million from 4.117 million a month prior. On a year-over-year basis, supply was up 8.9%. The months supply at current sales pace indicator of inventory fell to 10.7 from 12 in August. The median price of an existing home slumped 3.3% from a month prior and 2.4% from a year earlier.
Existing home sales surged last month, as buyers took advantage of near-record low mortgage rates and bargain-basement pricing. Another likely contributing factor to last month's strength? Any contracts signed by buyers using the home buyer tax credit had to close by September 30.
Combing through the data, you see that sales were strong in all regions of the country, with the Midwest leading the way. The pickup in activity helped whittle away at the mountain of inventory on the market. But we still haven't made much progress overall. That helped keep the pressure on prices, which fell from both the prior month and year. Longer term, we should continue to see stabilization in the housing market as 2010 rolls over into 2011. But we won't witness a vigorous recovery thanks to lackluster job growth, inventory pressures, and ongoing problems in the mortgage market.