If You Can, Now is the Time to Buy a Home

November 12, 2011

A new report released this week shows that home prices across the country are still falling but home sales are up, because this is the optimal time to buy.

According to the National Association of Realtors® latest quarterly report, the median existing single-family home price fell in 111 out of 150 metropolitan areas in the third quarter of this year compared to the same time last year.

sold signAt the same time, year-over-year third-quarter home sales rose in every state, which is what the housing industry needs for a recovery.

“Home sales need to recover first — only then can prices stabilize,” said Lawrence Yun, NAR chief economist. “Existing-home sales are little changed from the second quarter but are notably higher than a year ago. The good news is inventory levels have been trending gradually down.”

Existing-home sales dropped 0.1 percent in the third quarter from the second quarter but were 17.0 percent higher than the pace during the third quarter of 2010.

The national median existing single-family home price was $169,500 in the third quarter, down 4.7 percent from $177,800 in the third quarter of 2010.

NAR’s Housing Affordability Index registered 183.8 in the third quarter, the second highest on record after the first quarter of 2011. The index measures the relationship between median home price, median family income and mortgage interest rates; the higher the index, the greater household purchasing power. Record-keeping began in 1970.

“Housing affordability conditions have been at a record high this year, rents are rising and homes are selling for less than the cost of construction in most of the country,” said NAR President Ron Phipps.

“For people with secure jobs, good credit and long-term plans, today’s conditions will be remembered as a golden opportunity to enter the housing market.”

Categories: Economy

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