Existing home sales slow down

By Les Christie, staff writerNovember 23, 2010: 10:51 AM ET

NEW YORK (CNNMoney.com) -- Following a couple of months of gains, sales of existing homes retreated again in October, an industry report said Tuesday.

The National Association of Realtors reported that the number of homes sold fell 2.2% from September to an annual rate of 4.43 million. The rate was down 25.9% from 12 months earlier.

The report came in just about at expectations. A consensus of experts surveyed by Briefing.com had forecast an annualized sales rate of 4.42 million.

"The housing market is experiencing an uneven recovery," said Lawrence Yun, NAR's chief economist. "Still, sales activity is clearly off the bottom and is attempting to settle into normal sustainable levels."

Home sales have been slow despite some of the best buying conditions in many years: interest rates near 4% for 30-year fixed-rate loans, the most affordable home prices in many years and a wide choice of homes available for house hunters.

The median price of all existing homes sold during the month was $170,500, down 0.9% compared with 12 months earlier. About a third of the market was in distressed properties, repossessed homes and short sales.

Mike Larson, a housing market analyst for Weiss Research, said that positive and negative forces have been offsetting each other, leaving a market in limbo.

"You have low home prices and interest rates on the one hand, but trouble getting financing on the other," he said. "And unemployment remains stubbornly high."

The struggling economy certainly has dampened housing market performance, with unemployment well above 9% nationally. The job outlook seems to have brightened a bit lately.

"Based on current and improving job market conditions, and from attractive affordability conditions, sales should steadily improve to healthier levels of above 5 million by spring of next year," said Yun.

For months now, neither prices nor sales volume have been moving strongly in one direction or another, according to Larson.

"That followed years of the market either being very good or very bad," he said.

There's still fear among buyers, but the market's steadiness has lessened those fears from the first years of the bust.

"Buyers are now afraid that their homes will be worth less a year from now," said Larson. "But during the bust, they were afraid their homes would becomeworthless."

It may take another shift in perception for markets to really take off again. If homebuyers think their properties will gain in value, that would help propel sales forward.  

#cnnfb_connect {background-color:#f5f5f5;width:auto;height:auto;padding:10px;clear:both;} First Published: November 23, 2010: 10:19 AM ETRight Now

Malls and discounters see big crowds as shoppers scoop up bargains to kickstart the holiday season. Flagship retail store in Times Square draws customers from around the world for its 10 p.m. Thanksgiving open. Holiday shopping: This year we did the legwork for you, asking business bigwigs to share their best gift picks. 

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A look inside Macy's studio where the iconic floats and balloons get ready for their march down Broadway on Thanksgiving day. Harlem Children's Zone president Geoffrey Canada says hiring better teachers and extending the school year will fix public education in our cities. Joanna Cruz and Tangela Fedrick receive food stamps while job training in a kitchen in Philadelphia. 

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Crowd-control methods learned after a 2008 tragedy appear to work.

Preliminary reports of Black Friday sales are starting to come in. The verdict so far: The crowds were bigger and people walked away with arms full of goodies, but shoppers spent only modestly more this year.

For consumers who haven't had their fill of Black Friday deals, online merchants will serve up another round of deep discounts, free shipping and other gimmicks on Monday.

Small businesses in a New Jersey town don't get doorbuster crowds on Black Friday, but this year's holiday shopping season should be better than last year's

No matter how diligently you plan for your post-career life, surprises can still trip you up.

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