WASHINGTON — Existing home sales during November 2006 increased by 0.6% to 6.28 million units on an annualized basis according to NAFCU's recently released Macro Data Flash on existing home sales. It was the second month in a row that existing home sales have jumped, an occurrence that last happened more than a year ago.
Despite the increase, existing home sales are down 10.7% from November 2005 figures. The median price of an existing home fell 3.1% to $218,000 from one year ago. It is the fourth consecutive monthly decline in existing home prices.
The inventory of existing homes decreased to 7.3 months of supply from 7.4 months in October 2005. Despite the reduction, inventories have increased by more than 30% over the past year.
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Although inventories decreased and sales increased in November, inventories remain high and the long-term trend of declining existing home sales will continue in 2007 the report read. "The decrease in existing home prices means that consumers will be unable to borrow against their home equity, thus constraining consumer spending well into 2007," the report added.
NAFCU expects existing home sales to average 5.9 million units in 2007.
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