U.S. new-home sales fall 34.5% from ’07

<span class=”Apple-style-span” style=”font-family: arial; font-size: 12px; line-height: 13px; “><span class=”Apple-style-span” style=”color: rgb(102, 102, 102); font-size: 10px; “>By Alan J. Heavens</span><p class=”byline lastline” style=”font-size: 10px; color: rgb(102, 102, 102); padding-top: 0px; padding-right: 0px; padding-bottom: 0px; padding-left: 0px; margin-top: 0px; margin-right: 0px; margin-bottom: 12px; margin-left: 0px; “>INQUIRER REAL ESTATE WRITER</p><div class=”body-content” style=”font-size: 12px; “>August new-home sales nationwide fell 34.5 percent from 2007, even as builders battled to reduce unsold inventory to try to get the housing slump to hit bottom.<br /><br />The Department of Commerce said today that sales of single-family houses during August were at a seasonally adjusted rate of 460,000, falling 11.5 percent below July’s revised 520,000-unit rate. In August 2007, the annual sales rate was 702,000 units.<br /><br />The median price of a new single-family home in August was $221,000. <br /><br />Nationally, there are 408,000 single-family houses for sale. At the current sales rate, it would take 10.9 months to clear that inventory.<br /><br />August new-home sales in the region compiled by Hanley Wood Market Intelligence were not available. <br /><br />Year over year sales in the West were half what they were in August 2007, as builders continued to compete with lower-price foreclosures that comprise more than half the existing-home inventory in California alone.<br /><br />Because of those lower prices, sales of existing homes in the West actually rose 5.9 percent in August over the same month in 2007 buy prices fell 23.9 percent year over year, since slightly less than half of those sales were foreclosures, the National Association of Realtors reported Wednesday.<br /><br />August existing-home sales in the eight-county Philadelphia region fell 25.1 percent from 2007, but prices remained level, Prudential Fox & Roach HomExpert reported Wednesday.<br /><br />Efforts by some bargain hunters to buy foreclosed properties in California, Arizona and Nevada are now being stymied by tougher credit requirements in the aftermath of the Fannie Mae/Freddie Mac takeover Sept. 8.<br /><span class=”Apple-style-span” style=”font-weight: bold;”><br />“Some homeowners unable to afford their $400,000 mortgage payments have been buying foreclosed houses at bargain prices, obtaining loans and then walking away from their original houses,” said Philadelphia mortgage broker Fred Glick, who also arranges loans in the California market.</span><br /><br />For example, new FHA guidelines require proof the buyer of the foreclosed house is able to make payments on both houses, thus effectively ending what is being called the “buy and bail” trend.<br /><br />The post-takeover drop in fixed interest rates appears to have been derailed by growing concerns about the efficacy of the government proposed bailout of financial institutions. <br /><br />Freddie Mac reported 30-year fixed rates rose to 6.09 percent from last week’s 5.78 percent.<br /><br />“Mortgage rates followed Treasury bond yields higher this week amid market uncertainty over the current state of the economy,” said Frank Nothaft, Freddie Mac vice president and chief economist. <br /><br />Year-over-year sales fell in every region. Only the Midwest saw a month-to-month increase (7.2 percent), and the South has lowest month-to-month decline (-2.1 percent), Commerce figures showed.<br /><br />The Northeast region sales fell 45.8 percent year-over-year, a reflection of a growing weakness in the New York market, where, as with the Philadelphia region, there has been a delay in the effects of the housing downturn, economists said.</div></span>

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