Richmond Real Estate News
Fewer Americans bought previously occupied homes in February, and those who did purchased them at steep discounts. The weak sales and rise in foreclosures pushed home prices down to their lowest level in nearly 9 years.
The National Association of Realtors said Monday that sales of previously occupied homes fell last month to a seasonally adjusted annual rate of 4.88 million. That’s down 9.6 percent from 5.4 million in January. The pace is far below the 6 million homes a year that economists say represents a healthy market.
Nearly 40 percent of the sales last month were foreclosures or short sales, when the seller accepts less than they owe on the mortgage.
One-third of all sales were purchased in cash — twice the rate from a year ago. In troubled housing markets such as Las Vegas and Miami, cash deals represent about half of sales.
The median sales price fell 5.2 percent to $156,100, the lowest level since April 2002.
“This information suggests that value investors are entering the market, possibly a sign that home sales and construction are nearing a bottom,” said Joseph A. LaVorgna, chief U.S. economist for Deutsche Bank Securities. “Lower prices are certainly a factor behind the opportunistic buying.”
Housing has been weak for some time. Millions of foreclosures have forced down home prices, and more are expected this year. Tight credit has made mortgage loans tough to come by. And some potential buyers who could qualify for loans are hesitant to enter the market. High unemployment also is deterring buyers.
One obstacle to a housing recovery is the glut of unsold homes on the market. Those numbers rose to 3.49 million units in February.