Distressed Homes Fell in August
The number of distressed homes or foreclosed and short sales, represented 8 percent of August sales, remaining in the single-digits for the second straight month and down from 12 percent a year ago, according to the National Association of Realtors.
At least six percent of August sales were foreclosures and 2 percent were short sales. Foreclosures sold for an average discount of 14 percent below market value in August (20 percent in July), while short sales were discounted 10 percent (14 percent in July).
Properties typically stayed on the market in August longer (53 days) than last month (48 days) and a year ago (43 days). Short sales were on the market for a median of 135 days in August, while foreclosures sold in 53 days and non-distressed homes typically took 52 days. Forty percent of homes sold in August were on the market for less than a month.
According to Freddie Mac, the average commitment rate for a 30-year, conventional, fixed-rate mortgage fell for the fourth consecutive month to 4.12 percent in August from 4.13 percent in July, and remains at the lowest rate since June 2013 (4.07 percent).
Single-family home sales slipped 1.8 percent to a seasonally adjusted annual rate of 4.46 million in August from 4.54 million in July, and are now 4.9 percent below the 4.69 million pace a year ago. The median existing single-family home price was $220,600 in August, up 5.2 percent from August 2013.
Existing condominium and co-op sales declined 1.7 percent to a seasonally adjusted annual rate of 590,000 units in August from 600,000 in July, and are now 7.8 percent below the 640,000 unit pace a year ago. The median existing condo price was $213,900 in August, which is 2.1 percent higher than a year ago.
Regionally, August existing-home sales in the Northeast jumped 4.7 percent to an annual rate of 670,000, but remain 4.3 percent below a year ago. The median price in the Northeast was $265,800, which is 0.8 percent lower than a year ago.
In the Midwest, existing-home sales increased 2.5 percent to an annual level of 1.24 million in August, but remain 3.9 percent below August 2013. The median price in the Midwest was $173,800, up 5.9 percent from a year ago.
Existing-home sales in the South declined 4.2 percent to an annual rate of 2.03 million in August, and are now down 4.2 percent from August 2013. The median price in the South was $186,700, up 4.7 percent from a year ago.
Existing-home sales in the West fell 5.1 percent to an annual rate of 1.11 million in August, and are 9.8 percent below a year ago. The median price in the West was $301,900, which is 5.4 percent above August 2013.
Earlier, NAR reported that cash sales activities in the real estate sector declined in August causing home sales to slightly retreat during the month after four months of successive gains, according to the National Association of Realtors. Sales increases in the Northeast and Midwest were outweighed by declines in the South and West.
Lawrence Yun, NAR chief economist, says sales activity remains stronger than earlier in the year, but fell last month as investors stepped away. "There was a marked decline in all-cash sales from investors,” he said. "On the positive side, first-time buyers have a better chance of purchasing a home now that bidding wars are receding and supply constraints have significantly eased in many parts of the country.”
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The following article is from one of our external contributors. It does not represent the opinion of Benzinga and has not been edited.