Mar
23

Housing Market Needs Spring (Chicago Residents too)

March 23, 2011

The Spring home-buying season has yet to begin, and that is evidenced by several recently released reports.

On Wednesday, the Commerce Department said that the purchase of new U.S. homes in February fell to the slowest pace on record.

Sales fell 16.9 percent to an annual pace of 250,000 last month. Experts had actually predicted home sales to increase to a median pace of 290,000.

Last week, the Commerce Department reported that housing starts in February dropped to their lowest level since April 2009 while construction permits fell to a record low.

house with a reduced price sign in front of it.Builders are competing with a saturated market of existing homes and foreclosed properties for sale at bargain prices.

The average sales price for new U.S. homes was $246,000 in February, but the median price of new homes sold was only $202,100.

Those are the lowest new home prices to be seen since 2003.

On Tuesday, the Federal Housing Finance Agency reported that existing home prices throughout the country fell for the third straight month in January.

Prices fell 0.3 percent on a seasonally adjusted basis. Experts had expected no more than a 0.2 percent decline.

On Monday, the National Association of Realtors reported that the sale of existing homes fell 9.6 percent in February, the median home price dropped to a 9-year low and the supply of unsold homes rose.

All this data currently supports the Federal Reserve’s view that the housing market “continues to be depressed” while the rest of the economy improves.

Chicago real estate owners are depressed, too. After a couple teaser days of warm weather, snow is back in the forecast for tonight.

But that also allows us to look on the bright side: Since it’s still basically winter, that means the Spring home-buying season has yet to begin.

Categories: Economy

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Tracey

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