Home/Mortgages/Home Transactions Drop 14.6% in September but Remain Higher than Last Year

October 14, 2011 (Jeff Alan)

Closed transactions of home purchases plummeted 14.6 percent in September but were still 7.6 percent higher than in September 2010 according to RE/MAX’s National Housing Report (NHR).

Forty-four out of the 53 metro areas in the report posted year-over-year increases in closed transactions. Last month 47 of the metro areas posted sales increases. Des Moines, IA (+31.3%), Minneapolis, MN (+30.1%), Wilmington, DE (+28.4%), Trenton, NJ (+27.3%), and Providence, RI (+23.5%) recorded the highest gains in closed transactions in September.

The median sales price of a home declined 2.5 percent from $189,831 in August to $183,762 in September and was 3.3 percent lower than the median sales price of $190,035 in September 2010.

The year-over-year median price difference has improved every month for the last six months. In August the price difference from the previous year was 3.6 percent.

Seventeen of the 53 metro areas posted higher sales prices in September than they did a year earlier, up from ten metro areas last month. The areas that posted the largest price gains were Detroit, MI (+13.4%), Miami, FL (+8.4%), Orlando, FL (+7.8%), Anchorage, AK (+5.1%), and Indianapolis, IN (+4.5%).

The average number of days it took to sell a home in September was 94, which was up from 90 days in August. The slowdown in sales in September resulted in the average months supply of inventory increasing to 7.4 months, up from 6.8 in August but down from a 9.8 months supply of homes in September 2010.

The average monthly inventory of homes for sale decreased for the 15th straight month, possibly due to the decreasing number of foreclosures coming onto the market, but the declining inventory can’t make up for the seasonal drop in sales which is why the average month’s supply of inventory decreased.

For all 53 metro areas, the average monthly inventory of homes for sale declined by 4.8 percent and is 20.2 percent lower than in September 2010.

“It’s a good omen that home sales remained at a level higher than last year, and if this pace continues, we would hope to see prices start to rise too,” said Margaret Kelly, CEO of RE/MAX, LLC. “The market is trying hard to recover, and favorable policies from Washington would reduce the possibility of a further decline.”

Tags: RE/MAX, home sales, home prices, National Housing Report, seasonal trends, closed transactions, median sales price