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Buyers return to market, boost Nov. existing home sales

December 27, 2010 - Sales of existing homes climbed in November, a possible sign that buyers were ready to return to the market and hire moving companies.

The National Association of Realtors reported that existing home sales increased to a seasonally adjusted annual rate of 4.68 million in November. That was 5.6 percent above October's 4.43 million pace and 27.9 percent below sales from a year ago, when buyer activity was pumped up by the federal homebuyer tax credit. Analysts with the trade group said homebuyers may finally be responding to improve affordability conditions, and slightly higher mortgage rates may have encouraged many to get moving before rates climbed out of their reach.

"The relationship recently between mortgage interest rates, home prices and family income has been the most favorable on record for buying a home since we started measuring in 1970," said Lawrence Yun, chief economist at the NAR. "Therefore, the market is recovering and we should trend up to a healthy, sustainable level in 2011."

The report added that the national inventory of existing homes dropped to a 9.5 month supply, down from a 10.5 month supply in October.

Rates have dropped once again after rising well above record-low levels in recent weeks. Freddie Mac reported that the average interest on a 30-year fixed-rate mortgage was 4.81 percent this week.
 

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