Washington,
DC, Nov. 28—Sales of previously owned homes rose by 5.5% in October despite
rising unemployment and sagging consumer confidence. According to the National
Association of Realtors, existing home sales increased to a seasonally adjusted
annual rate of 5.17 million units last month, the highest level since August.
The rebound came after existing home sales dropped by 11.6% in September as the
terror attacks made Americans wary of making big ticket purchases.
“Three weeks after September 11, some of our major brokers were reporting that
sales had recovered to 95% of pre-attacks levels,” said David Lereah, the
association's chief economist. “Some of last month's recovery results from
transactions that were postponed from September.”
The housing market has been one of the few bright spots in an otherwise gloomy
economic picture. The market has remained stable during the more than yearlong
economic slowdown, thanks in large part to low mortgage rates.
In October, the average rate for a fixed rate 30 year mortgage was 6.62%, down
from 6.82% in September, and well below the 7.80% posted in October 2000,
according to Freddie Mac, the mortgage company.
In early November, 30 year mortgages dipped to 6.45%, the lowest level in 30
years of record keeping, Freddie Mac had reported. Since then, rates have edged
up and now stand at 6.75%.
Analysts say that the lure of low mortgage rates are cushioning the impact of
other negative, economic factors. The nation's unemployment rate soared from
4.9% in September to 5.4% in October.
Against the backdrop of low mortgage rates, the association predicts that for
all of 2001, existing home sales will total 5.19 million, the second highest
level on record, and a 1.3% increase from 2000.
By region, home sale rose last month by 10.2% in the Northeast to a rate of
650,000. In the Midwest, they went up by 7.3% to a rate of 1.17 million and in
the South they rose 6.2% to a rate of 2.05 million. Sales grew by 1.6% in the
West to a rate of 1.31 million.
The rise in overall sales in October lifted prices. The median existing home
sales price was $145,300, up 4.8% from the same month a year ago.
Copyright
2001 Floor Focus Inc
