Sales of existing U.S. homes increased more than forecast in October to the highest level since February 2007, spurred in part by a tax credit that lured first-time buyers.
Purchases rose 10.1% to a 6.1-million annual rate from a 5.54-million pace in September, the National Association of Realtors said today in Washington. The median sales price decreased 7.1% from October 2008, the smallest decline in more than a year.
Cheaper homes and stimulus such as the $8,000 U.S. incentive, extended and expanded by the Obama administration this month, have revived an ailing housing market that contributed to the worst economic slump since the Great Depression. Further improvement that would aid the economy’s recovery depends on an easing in unemployment and foreclosures.
Existing home sales were forecast to rise to a 5.7-million annual rate, according to the median forecast of 66 economists in a Bloomberg News survey. Estimates ranged from 5.2 million to 6 million, after an initially reported 5.57-million rate in September.
Sales had reached a 4.49-million pace in January, their lowest level since comparable records began in 1999.
Purchases of existing homes rose 23.5% in October compared with a year earlier. The median price fell 7.1% from a year ago to $173,100.
The number of previously-owned unsold homes on the market fell 3.7% to 3.57 million. At the current sales pace, it would take seven months to sell those houses compared with eight months at the end of the prior month. The months’ supply is the lowest since February 2007.
The report showed sales of existing single-family homes rose 9.7%, the biggest gain since 1983, to an annual rate of 5.33 million. Sales of condos and co-ops increased 13.2% to a 770,000 rate.
Sales of previously owned homes, which make up more than 90 percent of the market, are compiled from contract closings and may reflect purchases agreed upon weeks or months earlier. Many economists consider new-home sales, recorded when a contract is signed, a more timely barometer.
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