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Sales of Previously Owned Homes Fell 7.2% in January

I’ll summarize the article — House purchases decreased 7.2%, the second-largest decline ever. Economists forecasted existing home sales would rise in January. In December, sales decreased a record 16.2%. The median sales price was unchanged from the same month last year.

The percentage of homes sold to first-time buyers fell to 40% in January from 43% in December, indicating the renewal of the tax credit in early November failed to spur increased demand.

Distressed sales accounted for 38% of total homes sold, compared with 32% in December. Sales of homes paid with cash, largely a reflection of investor demand, accounted for 26% of all existing home purchases.

Purchases fell in all regions, led by an 11% decrease in the Northeast. 

Some of what is driving the poor housing results is unemployment at 10%.  In reality this percentage is higher since it does not consider people that have given up looking for a job.  Without jobs, people won’t have the money to buy homes or even qualify for a loan. 

With tax credits about to expire, bad weather in February, and the ever increasing possibility that the Fed will adjust interest rates, this news isn’t so good for the housing market. 

If you need to sell your Philadelphia or Bucks County house, contact us and I can offer you multiple real estate solutions.

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February 27, 2010 - Posted by | Uncategorized | , , ,

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