Real Estate Market Research: Real estate group says sales slump is national

Sales of existing homes fell in Pennsylvania, New Jersey and 43 other states during the October-to-December quarter, with metropolitan areas showing growing weakness, a real estate trade group said yesterday.The Philadelphia region did show a 1.1 percent increase in the median sale price of existing single-family homes.

For the most part, however, the fourth-quarter data from the National Association of Realtors underscored the breadth of the housing market’s slump.

In Pennsylvania, existing-home sales were off 13.5 percent from the same quarter a year earlier. New Jersey fared better, but still saw a 9.1 percent drop-off.

South Dakota was the lone state to show a sales increase. Existing-home sales there rose 8.9 percent from the same quarter a year earlier. Sales were unchanged in North Dakota. No sales figures were available for Idaho, Indiana and New Hampshire. Sales also fell in Washington.

Median home prices fell in more than half the 150 metropolitan areas surveyed. The Philadelphia region – including the Camden and Wilmington areas – was not among the losers, though. Prices rose 1.1 percent from a year earlier, to a median of $226,800.

But, of 77 metro areas that experienced declines, 16 showed double-digit percentage drops, the trade group said. The largest price declines were found in Lansing, Mich.; Sacramento, Calif.; Jackson, Miss.; and Riverside, Calif., which posted price declines of 17 percent to 19 percent.

Lawrence Yun, the trade group’s chief economist, attributed the declines in median prices to mortgage-market problems that mushroomed last fall, making loans more expensive for borrowers looking to take out “jumbo” mortgages larger than $417,000, the maximum size of mortgages that government-sponsored mortgage companies Fannie Mae and Freddie Mac can purchase and market as securities.

“The continuing crunch in the jumbo-loan market that began in August has disproportionately reduced the number of transactions in higher price ranges,” Yun said in a statement.

Nationwide, existing homes sold at an annual rate of 4.96 million units in the fourth quarter, down 21 percent from the sales pace of the fourth quarter in 2006, the Realtors’ group said.

The states suffering the biggest drop in sales in the fourth quarter were Nevada, 44 percent, and Wyoming, 42 percent. Other states with big declines were New Mexico, 39 percent, Oregon, 38 percent, and Arizona, 37.6 percent.

Mortgage lenders, would-be home buyers, and Wall Street investors have been grappling over the last year with the impact of rising defaults, the result of lax lending standards prevalent during this decade’s housing boom. As defaults have risen, lenders have grown more cautious, which has allowed fewer buyers to qualify for home loans.

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