Steady December home sales capped the best year for the U.S.
real estate market in five years, according to an industry trade group report
Tuesday.
The National Association of Realtors said that December sales
of previously-owned homes came in just slightly below November's sales pace, but
up 12.8% from a year ago. That brought full-year sales to 4.65 million, up 9%
from 2011 and the best year for home sales since 2007, when there were 5 million
homes sold just before the start of the recession.
Sales are being helped by a combination of strong market
fundamentals -- near record low mortgage rates, lower unemployment and a rebound
in home prices, all of which are bringing in buyers into the market who had been
waiting for it to hit bottom. The mortgage rates and years of depressed home
prices have also combined to create the most affordable housing market on
record, according to the Realtors group.
And the Realtors are predicting strong sales should continue
into 2013 and beyond. It has a forecast for 5.1 million existing home sales this
year, and 5.4 million next year.
The improved demand for homes in December led to the
inventory of homes for sale to fall to 1.82 million homes on the market, the
lowest supply since January 2001. One factor in tightening supplies is a drop in
foreclosures and other distressed home sales, which made up only 24% of home
sales in December compared to 32% a year ago. The tighter supply, and the drop
in distressed sales, have helped to lift home prices so that the median sales
price for the year rose to $176,600, up 6.3% from 2011. That's the biggest gain
in prices in since the bubble year of 2005.
The rebound in the market for previously-owned homes is also
showing up in the market for new homes, where sales rebounded to their highest
levels since 2009, while housing starts reached the highest level since 2008.
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