Existing Home Sales Surge in December

NAR identified the December pace is near the volume expected for 2011, so the market is getting much closer to an adequate, sustainable level.

Existing homes sales surged in December, continuing their upward trend with the fourth rise in the past five months. National Association of Realtors reported a 12.3 percent increase to 5.28 million (seasonally adjusted annual rate) in December, building on the 6.1 percent increase in November.

Overall, from the low of 3.84 million units in July, existing home sales have gained 37.5 percent in the five months to December. As more people purchase homes you will have opportunities for contracts to design, build and maintain landscapes.

Both single-family home sales and condominium and coop sales contributed to the sharp rise in December, with single-family home sales up 11.8 percent to 4.64 million units and condominium and coop sales rising 16.4 percent to 640,000 units. The strong sales growth in December was consistent across all regions, with sales in the West increasing 16.7 percent to 1.33 million, the Northeast up 13 percent to 870,000, the Midwest rising 11 percent to 1.11 million units and the South up 10.1 percent to 1.97 million units.

Despite the strong growth in home sales over the past five months, the inventory of for-sale homes remains high, with 3.56 million units available. At the current sales level, this represents 8.1 months' supply.

While this is a significant improvement on November's 9.5 months' supply, it is still well above traditional levels of 4 to 5 months' supply or a little over 2 million units observed between 1999 and 2005.

The parallel NAR practitioner survey indicated that of the existing home sales in December, 33 percent were to first time buyers, 20 percent were to investors and the remaining 47 percent were to repeat buyers.

Distressed home sales continue to be a major portion of sales, with 36 percent of December sales involving a distressed seller. This is up from 33 percent in November and the 32 percent share in December 2009.

- Courtesy of NAHB