Home sales take a breather, but prices hit five-year high

By Qiong (June) ZhangNo Comments

http://finance.yahoo.com/news/existing-home-sales-breather-prices-140918060.html

U.S. home resales unexpectedly fell in June after two straight months of hefty increases, but a surge in prices to a five-year high suggested the housing market recovery remained on course.

The National Association of Realtors said on Monday home sales fell 1.2% to an annual rate of 5.08 million units.

The median price for a previously owned home soared 13.5% from a year ago to $214,200, the highest since June 2008. The inventory of unsold homes on the market rose 1.9% from May, pushing the months’ supply to 5.2.

Distressed properties – which can depress prices because they typically sell at deep discounts – accounted for only 15% of sales last month.

Foreclosures and short sales, had made up 18%of sales in May.

In another sign of underlying strength, properties are selling more quickly. A home’s median time on the market in June was 37 days. That was down from 41 days in May and 70 days a year ago. Before the market collapsed in 2006, it usually took about 90 days to sell a home.

First-time buyers accounted for 29% of the transactions, far below the 40% to 45% economists and real estate professionals view as ideal.

Investors, who have been the main drivers of sales, bought 17% of the homes in June. That was down a touch from 18% in May and 19% a year ago.

Cash sales accounted for 31% of transactions in June, down from 33% in May.

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