The December existing home sales report was published on Monday. December sales were down 17% from November due to the planned expiration of the $8,000 first-time home buyers' credit. November was artificially high and December artificially low. Existing home sales were up 15% from a year ago and are now at a rate of 5.5mm. Overall for all of 2009 the pace was 5.2mm homes, up 5% from 2008.
The impact of the tax credit expiration can be seen by first-time buyer percentages. In November 51% of transactions were to first time buyers. This fell to 43% in December.
The tax credit was extended through April, and was expanded to include all buyers. There will be more data discontinuities in the Spring as a result, but by Summer the gyrations should dampen.
The average home price is now $178,300, up 1.5% from last year.
The housing inventory jumped from a supply of 6.5 months in November to 7.2 months in December; 6.0 months is considered "normal." There are 3.3 million homes on the market, which is 11% lower than last December.
Distressed properties accounted for 32% of the units sold. Most of the action was in the low priced home segment. Higher priced homes continue to be a drag on the market.
The average 30 year fixed rate was 4.93% in December, up a bit from November.
The West had the strongest market as the year ended, with declining inventory and rising prices. Prices stood 3% higher than a year ago.